Five Ways to Become Smart with Your Finances

Written by on November 16, 2012 in Money - No comments | Print this page

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If people think your current employment is great but, in truth, you’ve maxed out all your credit cards and you don’t have enough money left for that upcoming mortgage or car payment, then don’t simply assume they are mistaken. The problem probably lies with you. This is especially true if everybody else at the office is doing fine and there aren’t too many ex-colleagues who left to find better employment elsewhere due to their “measly” salary. If you want to solve your money problems without going on an endless quest to find the perfect (yet inexistent) employment opportunity, there are five ways to become smart with your finances to help you get by just fine.

NEVER Take a Second Mortgage

Taking a second mortgage is often ideal for people who are desperate to get capital for a “brilliant” business idea or to pay off a large debt to avoid larger interests, but it isn’t smart. If you are in need of cash that desperately, sell off assets like jewellery, paintings, stock certificates, or even your prized toy collection. Why is that smarter? Because getting money by selling something you completely own is more secure than making money out of an asset that isn’t completely yours yet. Chances are you’ll lose the house and end up with an unbelievable debt if your business goes defunct or you’re unable to make mortgage payments.

Don’t Apply for Credit Cards…

If you have a spending problem, do away with credit cards and stick with using debit cards for cashless payments instead. This will keep you from getting into larger credit card debt through spending money you haven’t earned. The alternative option may cause you to end up with no savings in the first few months (thanks to your spending habits), but you will painfully and effectively learn to manage your spending habits soon enough.

…But if you Can’t Help it, Get Low Rate APR Credit Cards

There are individuals who simply can’t do away with credit cards such as frequent travellers, so if you have a justifiable reason why you need a credit card, remember to stick with low rate APR credit cards. Some credit card providers may give loads of freebies like “a free trip to your dream destination”, but their APR is simply sky-high astonishing. It would be smarter to stick with a low rate APR credit card even if the perks are unappealing and pay for that trip or most-wanted gadget with your hard-earned money instead.

Don’t Bring All Your Treasure with You

The most effective way to control a spender’s extravagant spending habits is to limit his/her resources. So, instead of bringing all your credit cards, chequebooks, and cash, simply stick to bringing enough cash that can pay for your expenses during the day. You can bring one credit card, but keep in mind that it’s for emergency purposes ONLY.

Schedule Shopping and Dining Trips Reasonably

Most business establishments have smart managers who know ways to attract even the most pinchpenny customers, so here’s an effective way to avoid unscheduled shopping and dining splurges: don’t forbid yourself from dining out or from purchasing something you like, but schedule them reasonably and set a budget for each trip. That way, you won’t be able to make justifications like you haven’t bought something for yourself or dined out for a while when that temptation comes.

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This is a guest post.  uSwitch.com is the UK’s most trusted comparison website and one of the most reliable information sources for topics such as low rate apr credit cards. If you would like to know more about how to manage your finances by choosing credit cards wisely, then visit uSwitch’s website today.

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