Especially in a down economy, many of us are looking for ways to keep our checkbook in balance. We need to look carefully at all of our expenditures. We need to limit some and eliminate others. This careful look at your personal finances can help you maintain good finances for the rest of your life. Here are some tips to help you.
Interest payments are something we all need to take on at some time. They can be sensible, as with a mortgage or a car payment. But credit card debt, with its often high interest charges, sends many people over the edge financially. Using a credit card is so easy. But when it comes time to pay it off, it can be difficult. Always try to pay more than the minimum on your monthly statement. Only paying the minimum will keep you in debt almost indefinitely. Look at the amount on your statement that you have paid this year in interest. This, essentially is money wasted, money you could have spent on something you needed. Pay as much as possible each month, and see your credit rating go up.
Don’t put off balancing your checkbook. Do this as soon as you receive your monthly statement from the bank. An error where you forgot to enter an expenditure in your check register can cost you a lot if it means a bank charge in the future for inadequate funds. This will also hurt your credit rating. Balancing your checkbook can also mean good news. You may find that a deposit was not entered to your account. If you kept your receipt, you can go to the bank and have this corrected.
Add a little extra each month to your car or mortgage payments. This can save you a lot in future interest. Set a goal for paying these large loans off early.
Arrange to have a certain amount of each paycheck deposited in a savings account instead of putting all of it into your checking account–where you will spend it. Long term, this practice will do much to ensure your financial health. It will give you the funds you need for a down payment on a house or a car. It will give you a rainy day fund to draw from in time of need, so you do not need to borrow money for regular expenses.
When you need to borrow money, calculate how much you can pay back from your current monthly income. It is better to spend less, buy a less expensive car or house, than take on debt you will have to struggle with for years to come.
Sitting down and agreeing on a reasonable monthly budget is essential. Don’t leave the financial health of your family to chance! Live within your means, and you will find many opportunities open up to you in the future. Being in debt limits you in so many ways.
Use these tips to assure a bright financial future. A heavy load of debt can harm your well-being in many ways.