debt-free Archives

4 fool-proof ways to keep on top of your credit cards

8 June, 20221 June, 2022 Updated on1 June, 2022 Budgeting, Education

Credit cards certainly make life easier – they are simple to use, accepted almost everywhere, and help you to buy what you want, when you want, particularly online. So much so that living close to the credit limit has become the norm for many people and spending can quickly get out of hand. To make sure your credit card works in your best interests, use these tips to stay on top of your debt. Routine is key We all know how easy it is to let things get away from us. Just like that power bill sitting at the bottom of the stack of mail on the bench or “accidentally” bingeing an entire Netflix season while the laundry piles up, we tend to postpone boring, albeit important, tasks. Create a routine, though, and you’ll complete these jobs simply out of habit. It can be as easy as setting a monthly reminder in your calendar to check that your credit card payments are up to date. Paying your credit card balance off in full each month, will help you avoid pesky interest fees. This handy tip will also help you avoid any late fees! Make use of technology If organisation skills are not your forte, why not take advantage of the many apps and services designed to help? ‘Mint’ is one of the many useful apps available that will organise your spending into categories, helping you ensure there is always cash to go towards your credit card repayments. Making use of automatic payments in your banking app can also be helpful. Payments will be made on time and best of all, once set up, you don’t have to lift a finger! Cash advances cost more When money is tight, people are forced to use their cards for cash advances (withdrawing cash) instead of just purchasing goods and services… and in doing so, are paying a high price for the privilege. Interest is charged immediately on a cash advance and at a higher rate than purchases. Even if you have an interest-free card, you will immediately start paying interest as soon as you withdraw cash using your card. If you must take cash off your card, repay it as quickly as possible. Emergency funds will save the day! You’ve probably heard about the importance of emergency funds, and with good reason! If we’ve learnt anything over the course of the COVID-19 pandemic it’s just how quickly things can change, particularly within our economy. So, whether it’s an increase in the cost of living or a rise in interest rates, it is vital to have a bit of spare cash handy. A good place to start is with an emergency fund calculator. It will consider your income, savings, and living expenses, and provide an estimate of how much spare cash you should be saving for a rainy day. Realistically, many of us couldn’t get by without our credit cards, but it is vital that we use them in a way that only provides a benefit to our lifestyle. The secret to credit card success — keep your spending responsible and pay the full balance off every month; otherwise, the only winners are the banks. The information provided in this article is general in nature only and does not constitute personal financial advice.

Make this year a financially healthy one

5 January, 20223 February, 2022 Updated on3 February, 2022 Budgeting

Another year is over. Did you achieve everything you’d hoped? Are you better or worse off financially than you were this time last year? With a new year in front of you, what can you do to make the most of every moment? January to March Make a start by turning wishes into goals. Some might be long-term like becoming debt-free, saving a home deposit, or retiring in a few years’ time. What can you do this year to support those goals? Write it all down and give it a name. At the same time, don’t forget living for now. Prepare a month-by-month budget that makes room for the fun times – holidays and celebrations – as well as covering the necessities. Anticipate spikes in your spending. Do your car, home and life insurance premiums all seem to be due at the same time putting pressure on your cash flow? Investigate monthly premium payments or spreading renewal dates across the year. April to June It’s time to prepare for the end of financial year (EOFY). By June 30 you will want to have made any intended additional superannuation contributions (make sure you stay within relevant limits) and finalised donations to your favourite charities. Is there any other tax-deductible expenditure you can bring forward? June is also the month for EOFY sales – an opportunity to grab some bargains on early Christmas shopping and birthday gift purchases. Don’t forget to include these in your budget. July to September If you’re expecting a tax refund for the financial year just finished, lodge your tax return early. What are you going to do with the windfall? Whether you put it toward one of your goals or blow it on a big night out is up to you. Just make sure it’s part of the plan. With your tax return out of the way, the third quarter is a good time to start a bit of financial spring-cleaning. Review your super and savings, insurance and Will, loans and credit cards, Power of Attorney, and overall financial strategy. Is everything up to date? How’s your super doing? Would salary-sacrificing help? Can you consolidate debt or refinance at a lower rate? October to December Into the final quarter and how are you tracking? Are you ‘on plan’? Maybe the plan you came up with back in January wasn’t realistic. It’s not too late to adjust both your strategy and your expectations. If things are looking good, it’s important to stay focused. Christmas is looming with its temptations to over-spend. Once the turkey and plum pudding have settled, it’s time to review the year just gone and to give yourself a pat on the back for what you’ve achieved. Then take a deep breath, check your goals, and update the plan for the coming year. The information provided in this article is general in nature only and does not constitute personal financial advice.