The Right Way of Getting Your Finances In Order
Keeping your personal finances in order is something everyone should do but sadly not everyone does. Being able to manage your finances will help in a multitude of ways from making it easier to borrow in the future to reducing stress levels as you don’t have high debt hanging over you. With this in mind, we have produced this guide on helping you to get your finances in order.
Check & Clean Up Your Credit Score
Your credit score is very important when you need to do anything that involved money. It will help lenders determine the rate on loans and credit, even mortgages.
Checking your credit score is easy and can be done for free.
Here are a few places which you can do so
You can also join 1 or all of the 3 main credit agencies
Spending On Credit Cards? Get a Better Deal.
Balance Transfer Cards are ideal if you don’t plan on buying anything using them. If you do you’re just adding more debt and typically at a higher APR. If you need to use a credit card for spending then you should try and get a low APR or 0% purchase card.
If you are unsure if you can clear the balance each month then these cards will allow you to borrow at a lower cost.
If you are able to pay your balance off each month then you might do better to look at cashback or reward cards. This will offer lots of benefits to those who make repayments in full each month.
Sort Out Those Credit Cards
If you have a credit card that has an outstanding balance and you have paying interest then it would be wide to get a balance transfer card with 0% interest. This will allow you pay off your credit card debt quicker and cheaper.
You should double-check that this will be cheaper. Balance transfer cards normally charge a transfer fee represented in a %. See how much this charge will cost and compare it to the current interest you are being charged on your debt. If this is cheaper than a Balance transfer card could be the way to go.
Make sure you never miss a repayment or you might lose the 0% interest offer
Switch Bank Account
Maybe you don’t have a credit card or you are not interested in having one but you will more than likely have a bank account. Are you getting the best deals from your bank? Chances are you are not so switching could see a whole host of benefits come your way such as
- Interest-free overdrafts
- Up to 3% savings account
- Bonus when switching accounts, sometimes up to £200
Banks have been very aggressive with offers aiming to get you to switch. Also with the switch guarantee, it makes it very easy to switch accounts by moving all your in-going and out-going payments from your old account to your new one within 7 days.
Remortgaging Your Home
If the rate you got when you got approved your mortgage has come to an end then it might be a good idea to Remortgage.
Rates are at an all-time low and you could get a fixed interest rate for 2 to 5 years.
It’s important to know your LTV as the rates you are offered can significantly drop if you have a lower LTV which is basically your loan to value rate. You should get a valuation of your home and check what your outstanding balance is. This will give you your base LTV. Try to aim for an 80% LTV as the best rates start from there.
You should also take into account all the fee’s when working out if this can save you money. This would include exit fee’s Application fee’s, booking fee’s. You should speak to a mortgage broker to get the best deal and advice.
knowing what you spend each month and on what will help you budget and know what free cash you have. This would be items that you have spent each month such as, Rent, petrol, utilities and luxury’s you don’t want to lose. This will also help you to see where you can reduce payments if you are trying to reduce your monthly outgoings. For example, a common way to reduce your payments is through your TV contract, a lot of people have a Sky, BT or Virgin Media TV packages which when out of contract increase significantly. You can try to and get this reduced by calling and haggle for a new deal or remove parts of the package you no longer use. By doing this you can also help your self to save money each month and giving your self a set budget to spend on other luxuries such as meals out or the odd purchase.