ARTICLES > 7 Financial Tips to Bring you Peace this Christmas
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7 Financial Tips to Bring you Peace this Christmas
2. Budget, Budget, Budget! I had a friend who claimed to never use a budget because he didn’t believe in them. Thanks to a rich uncle, he was also a millionaire and so didn’t need to worry about money at all – most of us don’t have that luxury. We need to plan our spending. In most the FORTIfi literature you won’t see the word ‘budget’ because we realise the negative perception it has in people’s minds. We tend to think that budget means, stop enjoying life. Not so. A budget is simply a plan that tells you what you earn and, firstly, where you MUST spend it and, secondly, where you would LIKE to spend what is left over. That means, a budget is not a constraint to spending but a plan that gives you confidence to spend on things you would like without going into debt. 3. Plan for emergencies.  None of us want a crisis but we can all expect one at some time or another. Let’s say, your hot water cylinder suddenly needs replacing, what do you do? Most New Zealanders go into debt to replace it, and that debt follows them for a long time.Most New Zealanders spend all their surplus income and a little more and then feel nervous about being vulnerable to emergencies around the home. Begin to put aside a few dollars a week into an emergency savings account and you will discover the financial peace that comes from not having to worry about those unexpected events. In general it is good to have three to six months worth of income saved. For most people – especially families with a mortgage – that is not viable. However, if you could just put aside $2,000 in a separate account, you would be covered for most small household crises. 4. Monitor your expenses If there is one thing that separates those who are doing well financially and those who are not, this is it. Those who are doing well financially can tell you precisely what they spend their money on. This follows on from having a budget or spending plan. Tracking your finances enables you to see whether or not you are keeping to your budget. If you’re not, you can see where you are overspending and work out what to do about it. Financial peace of mind comes from tracking your income and expenses because, by doing this, you know your household operating costs and will know ahead of time that the money you require for something is there. 5. Plan ahead of time A number of the things that trouble us financially we know about before they occur – plan for them!! Christmas, birthdays, and anniversaries come at the same time every year, so plan for them ahead of time. The reality is, New Zealanders can be very casual with their finances. We spend without giving much thought to the future and then complain that we have to thrash the credit card leading up to Christmas. That is a pathway to debt and a sure-fire way to lose your financial peace of mind. Plan ahead of time and you’ll go through Christmas without the fear of how you’re going to pay for everything. 6. Get rid of debt  Money paid on debt interest is wasted money. Of course there are times we can’t avoid it; we buy a home and are almost sure to require a mortgage and so some interest repayments are inevitable. But, if we have debt, the challenge is to get out of it as soon as possible.The 400 richest people in the USA were interviewed and asked that they believed what the best way to build wealth. 75% of them answered, “become debt free, and stay debt free.” Being debt free totally changes your finances. Imagine what you could do if you didn’t have to pay your mortgage each month. The money spent on repayments would be cash in your hand and that would surely bring an incredible peace of mind. To learn more about how to track your finances easily, effectively, and quickly click here. |
Christmas is traditionally the time of “peace on earth and goodwill to all.” Unfortunately the stress of financial issues and overspending can often rob us of that peace. The reason for this is that so many New Zealanders live from payday to payday often playing catch-up with their finances. What causes a money crisis in the lives of many of us is when something unexpected happens. 