Work out how much debt you have?
How much owes on the mortgage, credit cards, personal loans, car loans.
Set some goals to pay them off.
What are the minimum payments per month on the loans?
Can you pay extra?
How much can you
save per week?
Work out how much to pay each week.
Example is, if the monthly mortgage is $2,578 or $30,940 per year, work it out weekly. That means that the payment weekly is $595 per week, but if you can pay back $600 per week, which is an extra $5/week, you can possibly reduce your mortgage by 3 – 5 years.
Did you know making weekly payments is better than monthly payments as it can reduce the interest each month?
Try and Save 10% of your wage each week, even if it is $20 or $50. Put into a savings plan eg: ING, Bank West, etc, savings account where you have it deducted each week from your normal account and cannot deduct anything unless you ring up or transfer via the internet. This helps you build your wealth. Also it has compounding interest, usually paying daily.
Track your spending, and find extra money to pay down the loans and debts. Write a list for a week of where you are spending money.
Example - $150 on food at Coles, $60 on petrol, $13 on Magazines, $80 on Cigarettes, $80 on Restaurant, $20 McDonalds, $100 on Sport. Then at the end of the week, work out what was necessary. Are you spending your food money on Junk foods or take away meals?
Did you know buying items on special or it bulk can save $100’s of dollars a year?
Example: Go to the butchers and buy 2 kilos of mince or chicken when on special, and throw into the freezer to use when needed. Go to your local fruit and veg shop where you know the fruit is fresher and lasts longer than at the supermarkets. Watch for specials, 2 for one, buy 6 for $2. But make sure they are items you will use and will save you money. There is no use buying 10 cans of Spaghetti for $4.00 if the family wont it spaghetti.
Write a shopping list for when going shopping. Do not impulse buy?
If you take a list, you will be more conscience of keeping to the list. If you cannot afford it – YOU CANNOT HAVE IT!
Learn how to play the credit card game. Always pay the minimum payments so that you do not get caught up with the debtor. Making sure you pay on or before the due date to stop late fees, and try not to over draw your credit cards.
Credit Cards – before you buy something, ask your self, do I need this. Can I afford to pay the $20 interest per month for the next 12 months for an item worth $50 now? Why not put it on lay-by and save up all that extra non essential spending each week and pay it off.
Christmas and Birthdays – go to the sales, put items on lay-by and pay off. July and January have the sales. Put items on lay-by, even if it is for the birthday 5 months later. Once you have paid it off, then you can put it away till you need to give it.
Did you know that if you pay $10/day off your loans or credit cards, then you can pay off your debt quicker? By saving the $10 a day on lunch or coffees and if you put this money aside, then you can make extra payments to your debts.
Spend time with family and friends: Go for a picnic or go to the local park with the kids. Spending time with family and friends can be worth more than money can buy and it can be cheaper than going to the movies. Take the kids to the Skate Park and take a drink and food with you, the kids will love it as you are doing something with them, honestly they don’t need everything bought for them, just you.
Kids Weekend Sport – take drinks and snacks, most parents are spending between $5 and $50 per weekend at the kids sporting games. As a treat support the local sausage sizzle, but don’t buy every week. (you can always buy a box of soft drink from the supermarket when on special and then take it with you – the kids wont mind)
Pocket Money - Teach your children to respect money and YOU. Times are hard, families are struggling, but if you teach your children to earn their pocket money rather than hand it out anytime, they will respect it more and you. Children these days understand more with what is going on with family debt and finances, and probably more than you realise. So sit down and explain to them, they cannot have the new play station game or Barbie doll this week. But maybe they can help around the house and earn some pocket money. Even if it is $1 a week, give them a list of chores they can do, like making their beds, and tidying their room, setting the table. This will help and teach children to respect their belongings, themselves and others. They will have an appreciation of things better if they save up and buy it themselves than giving it to them. We all want to give everything, but we have to realise we cannot.
Petrol – try to buy on Tuesday or Wednesday mornings. It is not only cheaper on these days; you get more petrol into your tanks due to it being colder in the mornings.
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