Managing personal finances has never been more important than it is today. The current economic climate requires that we do everything we can to stretch our resources. With that in mind, here are 5 tricks to help you stay on top of your finances.
1. Make a Budget
Preparing a budget is the most important thing you can do to stay on top of your finances. A well prepared budget will keep you on track and call attention to items requiring action. Gather up all your financial documents, list income and expenses by date, and make sure your income is sufficient to cover expenses. If not, you will need to revise your budget so that it balances.
2. Pay Your Bills on Time
Paying your bills on time will improve your credit rating and avoid unnecessary late charges. Establish a system for paying bills on time that makes sense to you. This can be as simple as writing amounts due on the cover of bill envelopes and sorting them by due date. If you have the skills, using an Excel spreadsheet simplifies this process.
3. Check Your Credit Report
Almost every financial transaction you make is affected in some way by your credit score. Banks and other financial institutions use your credit score to determine the interest rate you pay on loans and mortgages. Check online sources to see how you can get a free credit report once a year.
4. Look for Ways to Lower Your Expenses
The old saying “a penny saved is a penny earned” has never been more true than it is today. No matter what your income level is, it makes sense to look for ways to reduce your expenses. This can be as simple as reducing your grocery budget by buying store brands, or as complicated as finding ways to reduce your taxes, in which case you may need the services of a tax attorney.
5. Bank Online
To stay current on your financial transactions and avoid identity theft, consider online banking. You can check your balance on a daily basis and pay your bills electronically. It is much easier to correct a mistake immediately after it is made than to discover it at a later date.
Whether your finances are simple enough to handle them yourself, or so complicated that you need to hire a tax lawyer, we hope the 5 steps presented here will assist you in staying on top of your finances.