1. Budget – first and foremost you need to sit down with pen and paper, or excel, and put down your income(s)* and your outgoings! This will show you how much you have coming in and going out. It should also highlight places you are overspending in!
- Have access to your on-line banking or last statement – this will help you remember all your out goings.
- Be ruthless about cancelling direct debits you no longer need BUT be very careful about cutting financial products from your bank account. Please get a review with a Certified Financial Planner® before cutting your financial products.
To view my "Easy Steps to a Personal Budget" tutorial, click here.
2. Become debt free – Use all your spare cash to get rid of personal loans, credit cards car loans, credit union loans etc. Use the debit snowball effect which is paying off the smallest loan first, then the next smallest etc. Don’t go for the highest paying interest loan first as this could take too long to clear and will reduce your chances of success!
3. Ditch the cards – credit and debit.
- a. Debit - cash is KING! When spending on your debit card it can be very hard and difficult to track how much money you spend
- b. Credit – try make this year that you spend what you have put aside from your personal budget to spend! Don’t spend on credit.
4. Stop paying money for stupid things… – Like bottled water and coffee. This could save you over €1,000 per year.
5. If you are a smoker stop! – I was a smoker and stopped 4 years ago. I managed to save over €4,000 in 24 months! So I know it can be done!
6. Don’t change the car (unless yours is on its last legs, sorry wheels!) – Changing the car in January can be a very impulsive thing to do. But unless you’ve got cash please do not take out a new loan or an even bigger loan. It should be about trying to get debt free!
7. Please don’t start a gym membership, unless you are 100% committed - Losing weight can be as easy as stopping eating and walking – once you mastered this for the month of January then invest in gym membership in February! Plus it will be easier to find a treadmill in February.
8. Claim last year’s tax back! – Get onto revenue.ie (my account) and claim your tax back on medical/dental expenses from last year!
9. If you don’t have a second account with your bank get on it! – This second account should be used weekly to lodge money from your main (working account) into it. Your second account is going to be called Acorn Account. This is where you will act like a little squirrel and take money from your main account and hide it in your acorn account. So if you usually buy a cup of coffee for €2.50 a day going to work (€600 per year) at the end of each week (of not buying coffee) you will put €12.50 in your acorn account. If you were going to start a gym for €50 per month, don’t, instead set up a standing order for €50 to go from account 1 to your acorn account. You’re already on track to save €1200! Now I want you to transfer money from account 1 to acorn account every time you think of an impulse buy, but don’t.
10. Switch providers! – I’m a big believer in getting the best of value out of banks, utility providers, insurance etc. Give yourself 1 hour with a laptop, bank statements, and all your bills, statements/statements. It’s usually better to do this on a Monday to Friday 9-5 if possible so you can speak to existing providers and new providers if needed.
- Mobile Phone
- Home Phone/Broadband
- Car/home insurance
Take control of your finances, make your money work smarter, harder and go further. Put the right steps in place to meet your financial objectives no matter what stage of your life you are in.