Christmas and the New Year are two of the biggest and often the most expensive times of the year. These are also times when we tend not to be as budget conscious, with many of us overspending and overloading our credit cards and store accounts and then taking the rest of the year, possibly longer, to repay the debt.
Why You Should Check You Financial Health Now
Rather than having a great Christmas and then having to work extra hard to catch-up financially, we recommend that you check your financial health now. This way you’ll avoid costly interest payments and the stress of meeting debt repayments that you cannot afford. Checking your financial health is simple and it can save you a great deal of anguish when trying to meet your financial obligations. It will also allow you to live within your means and prevent you from making any spontaneous decisions that could be costly.
How You Can Check Your Financial Health
1. Look at your savings accounts.
Write down their balances. Know how much you can afford to spend on gifts and what has been allocated to pay any upcoming bills. Don’t spend your rent or the money you have set aside for the electricity bill on Christmas. Instead, think inexpensive.
2. Check your credit card and store account balances.
Write down their balances. If these are almost paid off or have nothing owing on them, then you possibly can afford to buy more. But, before you start spending work out how much interest you’ll incur if you don’t pay these off in full during the interest-free period. If you owe a lot on these accounts, then look at cost effective gift buying. Remember that sometimes less is more.
3. Check your credit report.
Contact a credit reporting authority and have them send out a copy of your credit report. If your rating is low, then look at ways to improve this. Start by spending less this Christmas.
Improving Your Financial Health
If you find that your financial health is poor or that there is room for improvement, then consider ways that you can improve this. Here are 3 tips to help you to improve your financial health this Christmas:
1. Reduce Your Debt
If you have a credit card/s and store accounts that you’re likely to use for Christmas gifts, then try and reduce the amount on these now. Begin paying more off of these weekly and continue until your debt is totally paid off. By aiming to pay these accounts off during the interest-free period you won’t incur any additional interest.
2. Make a Christmas Gift List
Rather than spontaneously buying food, drinks and gifts, make a list of what you need and how much you’re going to spend on each item, then stick to this. Make sure your list is based on what you can afford. Always try to live within your means and don’t stretch your budget beyond its capacity.
3. Less is More
Think small, inexpensive gifts that have meaning, rather than expensive gifts this Christmas. Be kind to your hip pocket and also to your financial and emotional well-being.
Are you seeking ways to budget better and to improve your financial health? If so, then now is the time to talk to eChoice, we can help you take control of your finances.
Written by eChoice