Budgeting
Five tips to get your finances in order in 2021
2020 was an interesting year to say the least and many of our plans were put on hold, especially when it came down to finances.
Then of course we had Christmas. It may have been a little different this year, but if you burned a hole in your wallet buying gifts or going on a well-deserved break, know that you’re not alone.
With a brand new year ahead of us there’s no better time to sort out a detailed plan to ensure more saving and less splurging in 2021. Start the year off right with our easy tips to help you kick those goals.
1. Create a budget plan
Shift your organisational skills into gear with an overarching budget plan.
First off, calculate what your fortnightly or monthly income is. Then, list all of your expenses from ones like your groceries, car expenses and rent or mortgage repayments to those things like your streaming services and gym membership. Split these into fixed and variable expenses, and must-haves and nice-to-have, and from there see what can be cut back or eliminated. There are all sorts of apps out there to help map it out or you can go old school and write it down yourself.
If you were financially affected by COVID-19, be aware that the JobKeeper payment ends on 28 March 2021 whilst JobSeeker payments end on 31 March 2021 and your income could be affected from these dates.
2. Set a personal goal
Studies have shown that New Year’s resolutions won’t work out if they’re too vague – how many times have you heard people say they’ll lose weight or get more organised this year? But if you narrow it down to a specific and personal goal then you’re way more likely to achieve it and the same can be said when it comes to budgeting and saving. Whether it’s paying off your mortgage or getting enough cash together for a mid-year family holiday, having that special something in mind will motivate you to keep that budget in action.
3. Make changes to certain habits
Saving money can seem like a daunting process that requires a lot of sacrifice, but a lot of the time you can embrace your frugal side with small tweaks to your day. For example, cut back on takeaways by researching recipes and recreating your favourite dishes at home or shorten your showers by a few minutes for a less expensive water/electricity bill.
4. Use a list when shopping
If you’ve ever gone grocery shopping on an empty stomach, you’ll know just how much more you can end up spending. However, when you’re shopping with a list, whether it’s for food, homewares or clothes, you’re less likely to fill your trolley with unnecessary stuff and throw away that much-needed money.
5. Manage your debt
One of the best ways to focus financially in 2021 is to sort out any overarching debt, whether it’s a personal loan, car loan or for your credit cards.
Paying it off is the main objective that we’re striving for and what’s more, the earlier you pay back a medium to large loan the more interest you’ll save.
