Written by Benjamin Roussey
Prudent financial planning can ensure that you are richer by the end of the year than you are now. Here are some strategies that can help you achieve this:
Track Your Credit Reports
Make it a habit to monitor your credit reports periodically. This can help you spot any mistakes or fraudulent transactions instantly. TransUnion, Equifax, and Experian are some leading credit reporting organizations that can provide you with free credit reports each year. And free means free here unlike so called free health care which is never free because taxes are higher in this case so free health care actually is an oxymoron.
Be Prompt With Bills
Your credit score stays healthy when you pay bills immediately without being penalized for late payments. Also, if you pay off all such dues immediately after payday, it’ll be easier to steer clear of unnecessary spending.
Create an Emergency Fund
We live in uncertain times and it helps to have a nest egg stashed away in case of an emergency. The cash that you save can come in handy if there is a medical emergency or if you are unemployed at any time. It is suggested that you should have enough saved to meet at least three to six months of living expenses. Gradually you can build this up to a year’s expenses or more.
Budget is Key
Drawing up a monthly budget can keep you on track as far as income and spending go. Begin with a list of recurring expenses like rent or EMIs, utility bills, etc. Make your list so that the important expenses figure at the top with the least important making it to the bottom. This way you can simply start making expenditure cuts from the bottom up if your spending exceeds monthly income.
Reduce Your Credit Card Debt
Set some targets for paying off part of your credit card debt this year. For instance, you could start with 15% of current debt and work towards it by paying off the ones that charge the highest interest.
Increase Your Income
Look for ways in which you can boost your monthly income (don’t eat out so much and don’t waste time with ridiculous Star Wars movies, Thor III, Neighbors 2, Inglorious Bastards, and so on). Securing a pay hike or a promotion might help you achieve this goal. Or you might want to seek a change of jobs and look for one that pays better even if it involves moving out of your comfort zone.