December 4, 2020
Many people postpone changes until the beginning of a new year. So, it’s time to get new financial habits that will definitely come in handy in the new year 2021.
1. Start keeping track of income and expenses
In order not to waste all your money on Christmas tinsel or ginger latte, start controlling your expenses and income. This can be done using financial planning services, a simple spreadsheet in Excel, or in a notebook.
Accounting for expenses and income will help you understand what you spend your money on, what expenses could be avoided, and how much you could save for a major purchase.
2. Manage your debt effectively
Of course, you would not like to meet the New Year with debts. But this is not always possible. If you do not have time to pay off the loans, then you can try to at least revise their terms. For example, combine all loans into one and refinance it.
If you are just going to apply for payday loans Delaware, first assess whether you really need this money and how soon you will repay your debt. Do not take any loans if you are not sure that you will be able to repay them on time.
3. Say NO to mindless expenses
All of us at least once a year are dazzled by “super-profitable offers” and spend money on things that will not actually bring any benefit or joy. But there are a few tricks that can help you avoid mindless expenses:
- Read the price tags carefully. Often they write the cost of the product per 100 g, although it may be of greater weight. Or they attach red tags to the price tag, and the buyer thinks that this is a discount;
- Evaluate marketing campaigns soberly. Often, sales and promotions make you buy something that you don’t need at all;
- Pause. You shouldn’t rush to the cashier with the item you like. You’d better postpone the purchase for hours, days, or even weeks. After this period, ask yourself the question again: do you really need this thing?
4. Follow your financial plan
Do you dream to finally save up for a car in the New Year? It will be difficult to do this without a well-thought-out financial plan: from time to time you will be tempted to spend money on trifles – and, as a result, you will lose your financial course.
Start by making a list of your top goals for the year. For example, buy an exercise bike, go on a long-awaited vacation and purchase a car. Immediately indicate the amounts that you will need to realize these desires.
Then assess your capabilities: your income and expenses, how much you can save per month. Think about whether you can save money for all your dreams at the same time, or whether it’s worth prioritizing.
5. Get a financial cushion
You want to believe only in the best in the New Year, but no one is immune from unpleasant surprises. If a sudden force majeure occurs, you should have a financial cushion that will equal several of your salaries.
To do this, try to set aside part of your salary every month – for example, 15%.
You’d better deposit this emergency reserve with a bank. Interest will be charged on your savings and you will be able to offset losses from inflation.
6. Read the contracts carefully
People are ready to read some books (for example about Harry Potter) many over and over again. But reading a boring and complicated contract seems an impossible task.
Find 20 minutes for studying the terms of the contract in order to avoid unpleasant consequences. Before you put your signature in the contract, make sure that all the conditions and terms are clear to you, the conditions are transparent, the wording is accurate. And don’t forget to get a second copy for yourself.
7. Start making passive income
The simplest option is a bank deposit. But if you already have a financial safety cushion for a rainy day, then you can try to invest some of the savings (but not more than 30%) in something more profitable, for example in a mutual fund or an investment life insurance policy. This is a good place to start: you don’t have to become an investment expert – your money will be managed by professionals.
If you are ready to independently monitor the situation in the stock market, you can buy stocks or bonds.
But don’t forget the risks: unlike bank deposits, investments in securities are not insured by the state.
8. Protect yourself from risks
You will not be happy if your apartment is flooded by neighbors in the New Year. But you can smooth out unpleasant emotions if the insurance company pays for the repair.
Natural disasters, illnesses, accidents, a meteorite fall – all these troubles are difficult to predict. But insurance will help cover losses and mitigate the impact.
You can insure anything: football players insure their legs, singers insure their voices, and you can take care of the safety of your own health, apartment and car.
9. Benefit from tax deduction
If you use the services of private clinics, your children go to paid clubs, or you bought an apartment, then you have the opportunity to receive a tax deduction. It allows you to reduce the amount of personal income tax or return a previously paid tax.
In order to get a deduction, you must be a citizen of the United States and have an official income.
10. Learn the tricks of scammers
Many people lose their vigilance when they are promised a high income. A “successful investment company” is often run by financial fraudsters.
Scammers can be recognized by the following signs:
- The company was registered just yesterday, on the eve of fundraising. Check the date of registration with the Secretary of State of the state. If the organization is not on the list, they are scammers;
- You are promised sky-high income – 30, 40, and even 600% per annum;
- The company assures that there are no risks;
- You are required to make an advance payment – usually in cash or by transfer to a card;
- You are persistently asked to bring new clients.
Before giving your money to anyone, gather all possible information about this company and carefully study the documents.
Do not be in a hurry. Perhaps your path to a financial goal will not be as fast as dubious companies promise, but you will be able to slowly but surely approach the desired results.
Category: Business and Finance
Tags: funding issue, money, payday, payday loans