Summer is the season about positiveness, people are happier, there is Christmas and New Year’s, and usually holidays planned. You spend lots of time eating and drinking with your family and friends. But between Christmas presents, holidays and events you also spend a LOT of money. So how do you achieve your goals and start the new year in a good financial position? You might have to make some adjustments.
At Keylend we are here to guide and assist you in reaching your financial goals so here’s just a few tips to help you clean up your finances and get you started on your new goals for the year!
Assess Your Debt
The best way to start cleaning up your finances is to assess where your debts are. Consider how much you owe, and what interest rates you are paying on those debts. Your debts could include a current mortgage, credit cards, car loans, personal loans, etc. Knowing what interest rate, you are paying on your debts will allow you to determine if there are cheaper rates in the market and which ones are a priority to get rid of. Then you can look at refinancing the higher interest rate products and take advantage of the current market which eventually will help clean up your finances.
Set Long-Term Goals
Set a long-term goal that you can stick with this could be saving for a holiday, buying a car, or buying a house, etc. Setting this goal is easy, achieving it on the other hand can be difficult. With a long-term goal, you can set more attainable short-term goals that allow you to reach that final goal. Make sure you adjust your expenses and savings to align with that same objective.
Cancel Unnecessary Subscriptions and Memberships
2020 brought many changes to our lives. One of those changes was spending a lot of our time at home. Suddenly we all began to subscribe to multiple services to entertain ourselves at home (E.g. Netflix, Prime, Spotify, online magazines, online services). Maybe it is time to evaluate which of these subscriptions are worth keeping, and which ones might be worth canceling.
Make a Budget
Budgets should not be all sacrifice; you are still allowed to have fun and enjoy life. Make a budget for yourself, consider how much you need to cover your fixed expenses (living expenses – food, rent, petrol, bills, etc.), add a little bit of extra money for luxuries (clothes, eating out, etc.). The rest of your income goes into your savings, setting this up as an automatic transfer into your savings account will help avoid the temptation to spend. Making savings an obligation in your budget will bring you many benefits to achieve these goals that you have set for yourself. One old rule of saving is to pay yourself first, this is your savings and can be a set amount like $200 per month or a percentage of what you earn a month.
