Preparing your Finances for Uncertain Times
Thanks to the levels of instability in the world markets, more and more people are feeling the effects of inflation on their salary cheques and overall financial situation. In the event that you lose your job or you start struggling to afford even basic essentials such as groceries, would you qualify for bank credit to see you through until things improve? Or would it be quicker and easier to obtain a loan instead?
Although there isn’t any way to predict the future economy, it is recommended that you secure your financial situation as best as possible. Below are a few handy tips to help you get started.
1. Every Penny Counts
Many people don’t save money because they think that saving the few pounds they have over at the end of the week ‘won’t make much difference.’ However, every penny you’re able to save not only has the opportunity to create interest; over time, the interest compounds, meaning that your efforts will certainly be rewarded in the long term.
If you regularly buy lunch during the work week or coffee on your way to work, cutting back just once or twice a week and putting the amount you would have spent into savings could result in you having a few hundred pounds extra to your name within a few months.
Another advantage of saving now is that you will have that little bit extra on hand to cover any emergencies that may arise, such as a burst pipe or a faulty boiler.
2. Reduce your Debt Levels
Being in debt not only costs a lot of money; it’s also emotionally stressful and draining. Depending on the amount of debt you have with various institutions, it may be possible to amalgamate everything you owe into a single loan. This will enable you to repay a single amount each month instead of multiple accounts.
Nowadays, there are numerous organisations and financial institutions that will be able to provide you with excellent advice regarding reducing your debt levels as efficiently as possible.
3. Compile a Budget
Although the idea of compiling a budget might seem tedious, it will enable you to see exactly where your money needs to go each week.
Compiling a budget is as simple as adding up all of your expenses and determining if your current income is able to cover them all. If not, adjustments will have to be made such as reducing n entertainment budget, spending less on eating out or even looking for practical ways to reduce electricity bills.
If you aren’t able to reduce expenses any further, the only other option you have to cover them all is to increase your household income. If possible, seek alternative employment or consider other options such as having a spouse return to work if money is becoming too tight to meet all of your needs.
4. Don’t Make Large Purchases Yet
Although you may be outgrowing your current home or you might be thinking that you deserve a new car, it may be best to hold off on making large purchases at present. With the economy being unstable, it can result in interest and repayment rates rising to higher levels than those that you will be able to afford at a later stage.
If you would like to find out more about how our logbook loan system could enable you to obtain funds in an emergency, contact our friendly team today. We will always be willing to do our absolute best to assist you with any lending needs.