A new financial year is a good time to start getting a grip on your finances. Having control of your money can mean the difference between living well or teetering on the edge of bankruptcy. Statistics show that people who do not manage their money are more likely to get into debt and generally struggle financially. It you don’t keep an eye on your budget, and know exactly where the money is going, then you could find yourself in hot water. There are some things that you can do to keep your finances in check.
Make Note of Transactions
Before you start creating budgets and plans to get you out of debt, you need to know how much money you spend a week. In order to be realistic, you need to remember that your expenses will change over a period of time. The best way to calculate the amount of money you will need on an average week is to keep receipts for one month, and then work out the mean amount you spend in a week.
When calculating this cost, you need to be fairly generous: don’t count every penny that you spend in the supermarket. Prices and needs change, and you have to have a little bit of flexibility. Keeping your budget so tight that you can’t manage even to buy an extra packet of crisps from time to time won’t benefit you. In fact, the tighter you hold onto your money, the more likely you are to find it running out of control.
Now you have a reasonable idea of how much you will be spending in a week, set your budget. It is a good idea to set aside bank fees and credit card debt each month before you allocate the rest of the money, as this will prevent you from spending more than you can afford. Rent, heat and lighting should also be higher up the list than groceries, snacks or days out. Once these important costs have been budgeted for, you should then divide the remaining money between food shopping, mobile phone tariffs, and entertainment.
Avoid Relying on Credit Cards
When you are trying to manage your money, there is nothing worse than spending heavily on the credit cards. Using the flexible friend can get you deeply into debt, and sometimes this can catch you by surprise. It is better to try and pay off credit cards, rather than using them to pay bills.
Set-up an Emergency Fund
It has been calculated that less than half the population keep an emergency fund. Even if you do have some money put aside, it may not be enough. Since the downturn in 2010, experts have suggested that people put aside enough money to cover at least 6 months’ worth of bills, shopping and essentials. Most people could not afford this sum, but it makes sense to try and put aside as much as possible. Even if you never need it, it is better than trying to manage without a regular income.
Managing Debt Collectors
Talk to The Citizens Advice Bureau
Citizens Advice are a great service for helping you deal with financial problems. They have seen and heard it all before, so will not be surprised or shocked by anything you say. Citizens Advice also have a number of financial solicitors who will be able to help you manage debt collectors, and can even intervene on your behalf. The Bureau is often packed to the rafters will people wanting help, so be prepared to wait, or contact them via the phone and have someone call you back.
Contact the National DebtLine
National Debtline are one of the first sources of help for people struggling with debt. These people can help you negotiate with your creditors, and can also provide you with suitable budget plans and other assistance. They can also give you advice on debt consolidation, individual financial arrangements, and even formal bankruptcy, if it comes to that.
Speak to the Office of Fair Trading
If you are experiencing unwanted calls from debt collectors, or are having trouble making it understood that you are not the person they want, then you can contact the OFT for more information. Speak to the OFT if you suffer bullying or intimidation from the collectors, and also get the names and addresses of any firm seeking to contact you in a threatening manner.
Being Pursued for Money you Don’t Owe?
If you find yourself at the receiving end of demands for payments after you have cleared a debt, then you may be suffering from illegal practices. Selling on a debt is against the law, but can still occur, and some people may find that a third-party sells on the apparent debt to collectors without checking it first. If you have had a disputed claim against you, or if you have been sought out due to debts which you haven’t taken out, then you may find it hard to prove that you are not the person they want. If you find that you are being pursued in such a situation, then your only recourse is to deal with the OFT, and hope that the company will be shut down.