New Year debt advice from Think Money
Posted on 12. Jan, 2012 by admin in General
Start your New Year on the best financial footing with a review of your personal finances and a plan for tackling your debt. That’s the latest advice from financial solutions company Think Money, who have recommended some simple steps to achieve financial fitness.
January can leave even the best intentioned people with a financial hangover from the seasonal shopping, socialising and sales. A review of your personal finances at the start of the New Year is the best starting point when you’re planning how to tackle debt.
Work out your income and expenses for every month, including all the essentials and how much you’re spending on debt. If you live with a partner, combine your income. An online budget planner can make this simpler.
Different households will need to take different action with their debts. People with ‘spare’ cash may be better off ‘overpaying’ certain debts. Credit cards are worth overpaying every month as there are no early repayments fees for doing so and you could save a lot of money in interest overall. If you’re a homeowner, it may also be beneficial to overpay the mortgage while you can afford to do so.
People with multiple debts could use debt consolidation to simplify their budget. Debt consolidation loans place multiple debts into one and leave the borrower with one monthly payment. Debt consolidation loans can even lower interest charges and monthly payments.
A quick word of warning – never secure any debt against your home unless you are certain you can afford the monthly repayments. Sometimes spreading the loan can add to the cost overall.
A financial review can sometimes uncover nasty surprises and some people may find their finances are in a worse shape than they realised. The sooner you know about a problem, the sooner you can deal with it. A debt expert could help.