The new financial year is the perfect time to think about getting your finances in order and trimming unnecessary spending. It offers you a clean slate to work off. If you don’t already track and monitor your spending, then this is the perfect time to start. Taking stock of your finances is the first step to sorting your finances before the end of the financial year. Nowadays, technology offers us a variety of tools to help us save money, track finances, identify expenses and set goals.
Sorting finances at the end of the financial tax year is also a great time for the self-employed as it also marks the end and beginning of the old and new tax year. It’s important to take into consideration how much tax you owe before planning for the coming year. It will also be a great opportunity to see how well your business has done over the previous year and see what services and work has provided you with the biggest profit margins. Going forward this can provide great leverage for financial strategy in business.
Planning is a huge part of financial management. Despite the amount of global uncertainty we face, there are still plenty of practical things you can do to help yourself see through economic uncertainty.
While assessing your finances, you might be considering ways you can get more money. From interest-free loans, payday loans, low-rate credit cards and extended overdrafts, there is plenty to entice you to build-up debt. All of these are fine if you can keep them under control and pay the money off each month. Importantly, it’s key to take out only what you can afford and not allow it to spiral out of control.
Furthermore, another area you can investigate when sorting out your financed, is negotiating better deals when it comes to services that you use. If you have a mortgage, it’s likely going to be the biggest monthly expense that you have, therefore it’s always a good idea to review your progress over the previous year. You can also go online to compare interest rates and if the rate you currently pay is no longer competitive then there is nothing stopping you from negotiating a better deal with your lender.
This approach can be used for all the services that you pay for – electricity, phone, internet, and insurance policies could possibly all be renegotiated or moved to other service providers. If you’re no longer driving to work, that may be grounds to reduce your car insurance payments.
You can also aim to consolidate credit cards and other debts substantially. If you shop around, you will be able to find financial institutions that offer interest-free periods which means your pay-backs will go straight to paying off the loan amount (rather than interest charges).
Reaching your life and financial goals is not just about growing your wealth but maintaining the habits needed to get there. A financial planner can help you optimise both your investments and insurance. They can help you better understand your financial options, and ways to build long term wealth.