Are your finances are getting you down? Yes? Then start by thinking about what you want to achieve – perhaps to be debt free? To save money each month? Or maybe to regularly pay into a pension?
You need to be in control of your finances before you can start setting goals. Consider any immediate challenges/blocks that stop you taking control and look for ways of breaking them down. For example do you spend beyond your means?
If so, look for ways of reducing your spending. Keep a note of everything you spend in a month – including magazines, wine, snacks etc and look at ways you can cut down. Look at what you have coming in and what you have going out. Make two lists: - one for necessary expenditure such as mortgage/rent, utility bills, food etc, and one for non-crucial expenditure such as clothes, smoking, drinking, entertainment etc.
Be really honest with yourself about how crucial some things are because if you are looking at ways of decreasing your outgoings you have to establish which are the really necessary ones. If you get all your necessary expenditure down on one list you can then work out your disposable income and where to spend it.
Owe money? Paying too high an interest rate? Change accounts or consolidate your loans into one that charges a lower interest rate. Some cards offer the incentive of 0% interest for 6 months if you transfer to them. Store cards often charge a massive 28% and are best avoided. Look at ways of paying off all your balances using a low interest loan that you can pay off each month – then chop up those cards. There’s no point thinking about saving until you have got rid of high interest credit cards etc.
Set yourself targets
· To stay within budget
· Use online banking as this means you can keep more up to date with your current balance. Most banks offer online banking now.
· Use debit cards instead of cheques as the money goes out of your account straight away and is easier to keep track of.
· After you have paid off you credit cards open a savings account and put an amount in each month by direct debit.
Look for ways of saving money, however small. Did you know that you could claim tax relief for cleaning your uniforms? If your employer does not look after the cleaning arrangements for your uniform or provide free laundry facilities for you to use, you can get tax relief on any costs of cleaning your own uniform that you have to meet out of your own pocket. You can claim relief for the current year and earlier tax years. Contact your local tax office for information (your employer can tell you the address if you do not know it) or alternatively obtain a form from the Royal College of Nursing.
If you pay a subscription or fee to ‘professional bodies or learned societies’ such as the Royal College of Nursing or Nursing Standard these are allowable for tax relief under section 201 of the income and Corporation Taxes Act (1988). The Inland Revenue publishes a booklet listing all qualifying organisations. Again contact your local tax office or the RCN. If you are a student member or a non-tax-payer you are not entitled to tax relief. Claims can be backdated for up to six years. Every bit helps.
If your finances are really out of control, don’t ignore them - get help. Talk to your bank manager, a financial advisor or even the citizen’s advice bureau. If you do nothing you will just get deeper into trouble. Beware if you do take out a single loan to pay off other debts – don’t make the mistake of taking out a bigger loan than you need. The real danger with this solution to debt is the fact that it is usually a secured loan (usually against a property) being used to pay off unsecured loans. If you don’t keep up with the repayments you could lose your home.
Anyone familiar with daytime TV will have seen ad breaks saturated by loan consolidation and debt management companies touting for business boasting that they can transform multiple debts into ‘one manageable monthly repayment’. However many people lured by the promise of getting their debt under control find they have had misleading advice and end up paying excessive charges. Many find themselves in an even worse financial mess than they were in before. However, what many people don’t realise is that these paid for services are in competition with the Consumer Credit Counselling Service (CCCS) and it’s younger cousin Payplan, which provide their services completely free of charge.
Finally look for ways of earning more money – even if it’s just a couple of hours overtime each week – the money soon adds up. Negotiate a wage rise at work – a higher grade or increment – the worst thing your boss can say is no. Most importantly if you can’t sort out your problems yourself don’t ignore those envelopes as they land on your mat – seek help – it could be easier than you think.
Useful addresses:
Consumer Credit Counselling Service,
Wade House,
Merrion Centre,
Leeds
LS2 8NGwww.cccs.co.uk
Email: info@cccs.co.uk
Payplan,
Kempton House,
Dysart Road
NG31 7LE
Email: help@payplan.com
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Posted by: John | October 29, 2007 at 08:01 AM