Upon receiving your paycheck, what is the first thing that you do with your hard-earned dollars? Do you first put aside the funds needed to pay your bills, or do you immediately think of purchasing ‘the’ item that you are itching to buy? What does your monthly budget look like? Are credit card bills a major part of your monthly expenses, or do you have enough money left to save in the bank? Although it may sound easy enough, a lot of people still struggle when it comes to managing their personal finances. The reason for this is that practical money-saving tips are not taught in schools, and unless you are naturally skilled with matters concerning money – it will be quite difficult for you to gain control of your financial life.
If you do not want to suddenly find yourself deep in credit card debt, you need to know how to manage your finances properly. Do your research online, or ask a financial expert for practical budgeting and debt management tips. Remember that taking control of your finances is crucial if you want to be successful in all aspects of your life. To help you with this goal we have compiled the top seven ways on how you can take charge of your finances, prioritize your budget and manager your high interest credit card debt:
1. Monitor the in’s and out’s of your finances.
Make a rough list of your monthly earnings. Calculate how much money you earn within a month for all of the jobs that you hold, as well as any other funds that come in. From this total amount, subtract the outgoing expenses. This will include your utility bills, mortgage, credit card debt and anything else that you need to pay for. It is also a good idea to make monthly savings as a part of your monthly budget. Even a little amount goes a long way, as long as you are putting aside your ‘savings money’ on a regular basis. Whatever amount is left should be allotted for all the other personal expenses that you may need.
2. Pay your bills on time.
Aside from avoiding late fees and other charges, paying your bills on time will teach you proper financial management. Once you learn how to accept the responsibilities of the debts that you owe – even for something as mundane as your electric bill – paying it on time will slowly develop your money management skills.
3. If you need a certain amount of cash for financial emergencies, go for community borrowing instead of getting a short loan from banks or financial institutions.
Peer-to-peer or P2P loans, social lending or community borrowing are gaining popularity nowadays. In
4. Learn how to control your debt.
Pay more than the minimum amount due on your credit card bills so that the interests that you owe can be covered. If you have more than one credit card, pay the balance of those which have the highest interest rate and pay the minimum amount for those with lower interest rates.
5. Go for refinancing if you end up having more credit card debt than you can handle.
If you find yourself neck-deep in credit card debt, go for debt refinancing. Debt consolidation is combining all of the credit card bills that you owe so that you will only need to pay one interest per month, instead of multiple interests which add up in the long run.
6. Review your credit card statements monthly.
Upon receiving your credit card statement, review it and make sure that the charges are accurate. Compare the statement against the receipts that you have of the major purchases that you have made within the month. Call your bank immediately in case you see discrepancies so that the items can be disputed.
7. Put off the big purchases for when you have excess funds for it.
If you are planning to buy a home or a new car, wait until you have more than enough money to cover the down payment or the mortgage. It is easy to fall into the debt trap and be excited about making a major purchase, but it is wiser to put it off until you have better control of your debts and finances.
It may take a lot of practice and patience to organize your budget and manage your credit card debt, but it is doable. At Lending Hub you will be able to consolidate and refinance your debts by creating a loan listing and setting a maximum interest rate that you would be prepared to accept. Once lenders finish bidding on your loan the loan will be settled like a normal personal loan and you will have the ability to quite possibly consolidate multiple credit card debts.