It’s well-known that a pro-active approach to your finances can save you money in the long run. That’s great news for people who like living a productive life, getting things done quickly and correctly. But what if you’re not sure where to start? This list of seven tips will help you get your finances in good shape. Let’s dive in!
1) Get a grip on your subscription services
Why do companies like the subscription model so much? It’s simple really: companies rely on subscribers forgetting to cancel once they no longer use a service. That’s why you should have an overview of your subscription services on a regular basis. Start by keeping a list for easy reference, adding to this list whenever you take out a new subscription.
Next, check this list every month and cancel the subscription services you don’t use anymore – immediately. Also consider which services you really need, maybe you can do without multiple streaming video subscriptions?
2) Make sure you make your money work
Have some spare cash? Ensure you stash it where it earns interest. There are a few points you need to think about when you invest. First, when will you need the money? If it’s money you will use within a few months look for a high-interest savings account. Money that you can live without for a few years can go into a fixed-deposit account that earns an even high interest rate.
Next, consider whether you can afford to suffer losing some or all of the money. If you can, you may want to think about investment options such as stocks which can earn far higher returns. These are also options where you don’t need to use the money anytime soon as investments in the stock market will often recover losses over long periods such as ten years or more.
3) Don’t overpay to borrow
Some of us simply don’t have spare cash. Instead it’s common to struggle with high debts. Debts almost always carry interest and here the smart people know that they need to do everything they can to reduce interest charges. How do you do this? Well, compare the rates available from apps that let you borrow money.
Depending on your credit score, your existing outstanding debts and how much you want to borrow you could qualify for much lower rates. Reduce your APR and you stand to save a lot of money, money that you can commit to repaying your debt burden.
4) Stay on top of your credit score
It’s not just people who want to borrow money that should keep close tabs on their credit score. Everyone should regularly draw a credit report. Why? First, you need to make sure nobody is committing fraud using your personal details. The first place to spot fraud is by noticing activity on your credit report which was not generated by you.
Next, lenders can sometimes get the facts wrong on your credit report, and it is up to you to correct it. Didn’t miss that payment? You’ll notice an erroneous report and can then get it fixed. Finally, you never know when you may need to borrow money unexpectedly: it’s always good to keep on top of your credit score, improving it where you can, just in case you need to borrow in future.
5) Compare and switch
Have you been with the same insurance company for years? Switching may pay off. If you haven’t recently compared your car insurance quote against what else is available on the market you may be overpaying by hundreds of dollars a year. The same goes for home insurance too.
Comparing is easy, just visit one of the many insurance search engines online to get the latest quotes. Compare the quotes on offer with what you’re paying now, taking care to make sure you match like for like in terms of coverage. See the opportunity to save? Make the switch.
6) Sort out your retirement
It’s a universal rule that the earlier you start saving for retirement, the less you need to save. Don’t have a 401(k) plan yet? Hurry up and get started, you’ll need to set far less aside every month if you start now, instead of waiting.
Already have a 401(k)? It’s worth reviewing your plan every now and again. Whether you see a personal financial adviser or make use of a robo-advisor you can quickly identify if you’re overpaying on fees, or where your money may be invested sub optimally.
