The new financial year is upon us, and experts say it is a great time to reset your finances.
Here’s how you can get started.
Look at your income and expenses. Every. Single. One.
Finance expert and founder of SugarMammaTV Canna Campbell said while it could be a difficult step, it was a crucial one in getting a hold of your finances.
“We can look at what our financial situation looked like this time last year, and even the year before that, and sort of see how we’re going, whether we are improving our financial wellbeing … and start setting some new goals financially,” Ms Campbell said.
“You can start afresh… you can say ‘I’m going to be more organised with my receipts, I’m going to be more switched on with knowing my deductions, I’m going to look at my career progression…’ it’s a really nice refresh and reset.
“Look at your transactions and actually see what things cost. Obviously, a lot of us have seen our energy bills go up, and gas bills, even my mobile phone plan went up the other day, so have a look at what you’re paying.”
Start by writing down your income and expenses over a six-month or year period to get a clearer picture of where your money is going. Also write out your debts and assets.
Cut the fat
With cost-of-living pressures, many people have cut not only luxury purchases, but other items in their budgets.
Look at every expense on the list and run a cost-benefit analysis on each, asking how much value it brings to your life. Items like groceries and energy bills will be part of the ‘musts’ list, whereas entertainment subscriptions might fall into ‘wants’.
Ms Campbell said doing research and calling current providers was the best way to make quick gains.
“Get on the phone and ask for a better deal or start shopping around,” she said.
“Loyalty tax… it’s expensive and quite often businesses are trying to get new customers, so they are willing to give better offers or if you sign up to a certain plan.
“I know for myself, when I called my energy provider to say ‘look, I’m thinking of going somewhere else’ … I actually got my bill down by $45 a month.”
She said doing research on what other providers were offering would help your “negotiating power”, but even just asking for the best deal could see a reduction in costs.
Ms Campbell said her family had also cut their monthly expenses by limiting trips to the grocery store, making meals out of leftovers and bringing lunch to work and buying must-have items second hand.
