There’s more than one hangover come January, and some will fade faster than others. January is the month where people are more likely to depend on their credit cards for essentials and less likely to have spare money to save- due to the financial hangover of Christmas. So, if you’re looking to detox your financial life, then here are the ten steps to take.
1. Know Your Debt
If you are unable to bring to mind the figures of debt, then detoxing the rest of your finances will be an uphill battle. How much exactly do you owe? What level of interest are you being charged? Know your debt, and you’ve hit one of the hardest steps right out of the park.
Do you really earn as much as you think you do? Do you earn as much as other people working in your industry do? Is there the possibility of renegotiating your income package with your boss?
3. Bank Basics
Are you using the best all-rounder account? Do you qualify for a high-interest savings account? Do you pay fees on bank accounts you don’t use? Talk to your bank about how your finances are set up with them, and whether there are any possible improvements.
4. Accounting Basics
Buy three financial exercise books. The first is your spending diary, for the month of January alone. Without it, you’ll never get your budget to match your actual lifestyle. The second is your budget; ensure you keep one column for ongoing notes on changes that would improve your budget. The third is a receipts book. This is the year you will keep all your receipts and claim all your deductions, and this book will make it happen.
5. Automatic Transfer
Automatically transfer 5% of your income into a savings account every week. Maybe it’ll be too tough. Maybe it won’t. It’s a great way to find out where your savings level is at, and start setting up regular financial structure for your savings.
6. Invest $100
Time to dip your feet in the scary world of investment. There’s little risk in setting up an investment account, and learning the ropes. Find out what companies you like. Learn to read sharemarket information. There’s no need to blow money on a dot.com lookalike, but it’s great way to get started.
7. Consolidate Your Super Accounts
Do it now. It’s money for nothing, and not even tricky to do. The simpler our financial set up, the greater our awareness of our financial wellbeing and the less administration costs we incur.
8. Open An eBay Account
Why not make it your change for 2013? Got lots of clothes you don’t want anymore? Stuff crowding your storage spaces? Detox your life as well as your finances, and sell, sell, sell.
9. Check Out Your Insurance
Too much or too little, either can be disastrous. You want to ensure your covered, without undermining your finances by paying premiums through the nose. Insure the essentials, protect your health and your assets and be sure to compare insurance schemes to save money.
10. Quit One Thing
Buying a chocolate bar at 3pm. Late-night iTunes purchases. Don’t quit everything, just choose one small expenditure and save your money throughout January. Put whatever you save into your savings account.