It’s still early in the year, and it’s not too late to get your financial house in order for 2014! With a few easy to follow rules, and some decent recordkeeping you will be able to whip those finances into shape. I want to provide you with a few tips on saving money, eradicating debt, and cleaning up your credit so that when 2015 rolls around you can start it off on the right foot.
The most important thing to remember when it comes to personal finance is that it’s paramount to spend less than you earn. Sounds simple, right? Yet so many people go wrong when it comes to this. They open credit cards, borrow money from friends and family, and all so they can buy the latest gadget, clothes, and automobiles. However, if you make it your life’s pursuit to spend less than you earn then you will most certainly avoid debt! It’s really that easy.
The second most important thing about personal finance is to create a budget. After all, this is how you will be able to track your spending so that you are able to follow my rule above. This is an area I actually recommend using a credit card as often as you can. The caveat is that you pay that credit card off each month! But in all honesty, they are the easiest way to track your spending, and they often provide online tools for breaking out your spending by time period and merchant.
Now that you are spending less money than you earn it’s time to do something with all of that extra money. First and foremost, start a retirement fund if you haven’t already. The longer you have to save for retirement the better, as your money will compound off itself in the years to come. There are many tools to help you plan for your retirement, for example this superannuation calculator can visually show you how much money you will have once you retire, and when you’ll run out
Making sure your credit is clean and accurate is important to just about every other aspect of your finances. If you have an error on your credit report it could affect your ability to take out loans and credit cards, not to mention it affects the rates you pay on those loans. Run a credit report each year and make sure you comb through it. Even if there aren’t any inaccuracies there could be outstanding lines of credit you have forgotten about over the years and it’s time to shut them down.