Times are hard, and our bills are getting larger. Our belts are becoming tighter yet we have a lot less disposable pay to assist us. As a result of this we are seeking the services of financial advisors to give us first-class Debt Management plans.
How many of us each month simply work out how much we have by the figure that shows up in our current account? Or still worse how many of us are continuously trusting on our overdraft instead of managing our funds more effectively? Before we get to the point that we have to deal with things like a Scottish Trust Deed or Debt Management Consolidation loan to bail us out, let us see if we can take responsibility.
How can we budget wisely? Well keeping track of your incomings and outgoings will tell you how much disposable pay you have each month. I for one have an excel worksheet with up to a year’s activity. It might look a little extreme but for the next 12 months I know the basics of what I have to pay for like rent; council tax etc also I know precisely what disposable pay I have.
I can plan for things such as holidays, anniversaries, auto maintenance etc and not worry that I’ve overstretched myself. I know if I have by checking further down the months. It in addition will mean I know when bills are due. We get paid at the end of the month so I know that I’ve got X amount to cover for the next month. After I get paid I at that time go through and pay any bills that don’t need to wait. I tend to work out why pay a bill on the fifteenth if you can pay it on the first. It won’t make a difference to how much money you have left spare and you don’t have to fret that you have forgotten to pay for it.
I’ve additionally set up direct debits or standing orders for things like rent and council tax, the food budget etc. Following my experience with forgetting the gas bill, I’m currently thinking of setting one up for that also.
You could possibly think that things like petrol and food will differ each month so why set up a direct debit? I would say that you’ll find it better to pay something than nothing. When you do fail to rememberto pay a bill then at least you know something has been paid and you won’t incur a late payment charge. Just ensure its a little more than a minimum repayment. If you don’t forget then all you have to do is pay the extra.
For instance let’s say we spend £200 a month on basic groceries but want to allocate a little extra for some niceties. Set up a direct debit for £200, but budget for £250 on your worksheet. By allowing for a little extra on your worksheet it’s possible see if this overstretches you or not. If it doesn’t then you know that after the £200 has gone out the bank, all you have to do is pay the £50 to pay the rest off.
The trick is to make certain that you do not go over your budget and that you always pay off in full. That is good Debt Management practice and could keep your finances is excellent health.
If we’ve already reached financial crippling then do not dismiss the thought of a worksheet to help you budget. Even if you have got a Scottish Trust Deed, you will see after the month to month payment goes out each month, what you have to work with each month. The same applies with a Debt Management Consolidation loan or transferring your credit card debts into one more convenient debt. By placing it all down on ‘paper’ we control our money and ultimately our lives better.
Tags: debt advice, debt-management, debt, credit card debt <BR/>
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