No matter how bright you are, you are bound to make some financial mistakes at some point in your life. It does not matter how informed you are, sometimes it is not easy to apply financial knowledge to your unique situation. Even the best and the sharpest cannot conceivably know everything.
Usually, people start thinking about solving problems when it is too late. According to IRS records, more than 12 million taxpayers asked for an extension to file their income taxes in 2014. This extension only gave the taxpayers six more months to complete their returns.
You can incorporate many things into your daily habits that can help you stay on top of your bills and save thousands each year. You could use those extra reserves to pay off any debts you have, put them on the side for your pension, or you could even afford some luxuries like a new car or a family vacation. With a bit of luck, the following list of tips will be useful and you will be able to enjoy the benefits whatever you decide to do with the money you saved up.
1. Childcare costs
The average monthly fee for a childcare day-center in America runs from $300 to $1,564 (in the UK it’s £460 – £850); the costs vary depending on your location, what type of care you choose and the age of your child. However, there are a few options out there that are more cost-effective; in-home centers tend to be cheaper that the center-based ones. In addition, more and more people these days have flexible work schedules, and if work at home just one day a week, you could save big on childcare costs.
2. Making and reviewing a family budget
Doing a budget enables you to sort out your financial priorities and find just the right balance between saving and spending. When you start, look at all money going in and out across the whole year; regular payments such as rent or home loan, electricity, cable, phone, etc. have to be included. Also, think about which items you need for basic living and which you could do without if you want to save some money. If you need any help, you can find an online budget calculator. Review your financial plan regularly, so you can stay on top of your finances and make adjusts when you need.
3. Planning your holidays
Everyone enjoys a vacation – whether it is to spend time with your loved ones, unwind and re-charge or something more active. If you are planning to travel overseas, shop around and try to get the best exchange rate, and remember to avoid exchanging your currency at airports, because you will rarely get the best rate. Also, if you are paying your holiday over a couple of months, be sure the check the interest rate. The best option, once again, is to browse the web for a little while and find agencies such as Travel Pay that offer you to pay for the trip interest-free. Moreover, be careful when using your credit card abroad, as you may be charged every time you use it.
4. Choosing the right mortgage
If you are getting your first mortgage, make sure that to shop around for the best rates and the best type that suits your circumstances. However, if you already have a mortgage, and you are not benefiting from any special deal, you should definitely consider getting a remortgage. Your current lender may be able to provide you with a better rate, or if not, think about switching off to a new provider if the deal is better. On the other hand, take into consideration that there are other one-off costs if you switch to a new provider before you decide what is best for you.
You can get rolling on any of these saving strategies in a matter of weeks. Take time to establish your financial goals, make a budget, check your credit and taxes and mark key-dates on your calendar. By starting your new financial plan on the right foot, you will be saving years of nervous tension and gaining confidence about your assets managing skills too.
About the author
John Stone is a business consultant and a regular contributor to Bizzmarkblog. A believer in the notion that thinking outside of the box is a prerequisite for being a successful entrepreneur.