The weather is changing, the birds are singing and people are busy cleaning, which can only mean that spring has finally spring! And if your finances are still suffering from a festive season hangover then now is the time to give them a spring clean too.
A successful financial spring clean needs to take into account every aspect of your personal finances and then look at ways to reduce any ongoing debt, review the way you spend and save and, ultimately, make your money go further.
So to make a start on your financial spring clean you need to gather together as much information as you can, from bank and credit card statements to utility and insurance bills. Once you have collated this information it is time to take a closer look at your spending habits and see how you can pay off, or at least offset, some of that debt.
Check the interest rate on your current credit cards and then, if you really cannot repay the balance in full (something that you should ideally be doing at the end of each month), try to transfer them onto an interest free credit card to reduce your payments and ensure that you are not paying any interest on these repayments. And whilst you have all of this information to hand it’s a good idea to set up autopayments on your accounts as this means that you won’t run the risk of missing a payment and incur any associated charges.
The next thing to do is to review all of your other monthly bills, such as cable, cell phone and ultilities and assess whether you’re getting value for money or paying for services you are not using. For example, are you actually watching all of the cable channels that you are subscribing to? And if you have unlimited cell phone usage but are only actually using 200 mintues per month can you switch to a cheaper contract? Although such changes may appear to be small when looked at in isolation, they soon add up and can amount to substantial savings over the course of the year.
Now is also a good time to check the expiration dates on your home and auto insurance policies and, if they are up for renewal, contact your current provider and try to negotiate a better renewal deal and then shop around for an even better deal. You may be surprised at how much money you can save by simply switching providers.
Once you have sorted out your monthly commitments, it’s worth taking a look at your credit report and make sure that there are no errors present that could be having a negative impact on your credit score. If you do come across any anomalies then it is vital that you sort them out straight away and your credit referencing agency will provide you with instructions on how to query any errors on your report.
By this point your personal finances should be running like a well-oiled machine and you will hopefully have a least a little more disposable income at the end of each month. If this is the case, then you should use this extra income wisely and, if you haven’t already done so, consider putting some money into an LSA or another type of individual savings account.
If you do have extra money to invest or put into savings then you should also get together a compete record of your investment portfolio have it reviewed by a financial planner to ensure that you are getting the maximum return on your investments.