Top: 7 Tips to Manage Your Home Finances
There’s no doubt that the ongoing pandemic has left huge implications on the economy. As most industries are trying to cope with the repercussions of the pandemic, it is no wonder that financial anxiety is at an all-time high- a notion which has been made worse for homeowners.
Going through the process of buying a property is extremely stressful and takes a lot of financial dedication and preparation, as it’s a whirlwind of paperwork and financial hurdles.
However, the constant hemorrhage of money doesn’t seem to stop once you have moved in and settled- as your expenses will be spent on various aspects of your home living.
Homeowners often underestimate the financial aspects of running a home, and how day-to-day living can result in people struggling with outgoings and other expenses. Here at We Buy Any House we have compiled our top tips to help you manage your homeowner finances.
Understand Your Current Financial Situation:
Before you think about budgeting or coming up with a long-term plan to manage your home finances, you need to understand your current financial situation.
A great place to start is to set up a meeting with a financial advisor, who can give you exact figures regarding your cash flow, income, savings and investments.
Plan Finances and Goals:
Once laying your current financial situation, the next step is to plan and determine whether your finances align with your lifestyle and values.
Taking into consideration your income and obligatory outgoings, the next step is to prioritise where your money is going to go.
For example, if your priority is spending weekends taking part in family or friend activities, or planning regular holidays, then these expenses should be taken into consideration.
It’s also wise to plan further than a year in advance, so that you can see how your finances are changing and affected over time. Start with the biggest financial goals you have- and plan around that. Setting budgets that target smaller, financial goals will help you be consistent in your spending.
Consider a Budgeting App:
If you struggle to stick to a budgeting plan, then perhaps it’s a good idea to consider investing in a budgeting app. Most banks have a free app which will help you manage your money via a smartphone- allowing you to make payments and review your spending.
It’s a great way to balance your finances on a regular basis, enabling you to have more control as to where your money is going.
Make ISA Contributions:
If you can manage it, it’s a good idea to make contributions each month into an ISA. Depending on how much you invest, you may be able to grow your savings.
Compare and Cut:
In all aspects of life, it’s always wise to compare- whether that’s for a product or service. This way, you can ensure that you are not paying over the odds for what you need, and you can find a way to get a better deal for a cheaper price.
In regard to your property, comparing prices for gas and electricity suppliers, Wi-Fi and broadband can help you find the best deals and in the long term- save some money.
Strip Back on Subscriptions:
Statistics show that during lockdown, subscription spending increased by 40% in the UK alone, as homeowners splashed on TV and film subscriptions such as Netflix, Disney Plus and Amazon Prime- in addition to meal and drink deliveries.
Although it may only seem like a small fee (as most cost around £5.99 a month), these costs soon add up and can amount to a substantial figure in your monthly outgoings. A good idea is to reduce the volume of subscriptions you have and work out which ones are useful and necessary.
Make General Cuts Around the Home:
In our homes most of us use appliances frivolously. We often don’t deny ourselves a long bath at the end of the working day, or a plethora of lights that shine continuously around the house at all hours.
However, these small things can dramatically increase the cost of your bills. There are several small ways in which you can decrease the cost of your electricity, water and gas bills- but it all relies on lifestyle changes.
Switching from a bath to a 5-minute shower in the evening will make small but noticeable changes in your spends, similar to other things such as making sure outlets are turned off and turning off the tap whilst you’re brushing your teeth.
Questiоns рeорle аlsо аsk
Whаt is the 50 30 20 budget rule?
The 50/30/20 rule оf thumb is а set оf simрle guidelines fоr рlаnning yоur budget. When yоu use them, yоu аllосаte yоur mоnthly аfter-tаx inсоme tо the three саtegоries: 50% tо “needs,” 30% tо “wаnts,” аnd 20% tо yоur finаnсiаl gоаls.
Yоur рerсentаges mаy need tо be аdjusted bаsed оn yоur рersоnаl сirсumstаnсes аnd gоаls.
Whаt is а gооd strаtegy fоr mаnаging yоur рersоnаl finаnсes?
8 tiрs fоr mаnаging yоur mоney the right wаy
- Set uр the right bаnk ассоunts.
- Mаke а рlаn fоr yоur mоney. …
- Set the right finаnсiаl gоаls. .
- Tаke stосk оf yоur сurrent finаnсiаl situаtiоn. …
- Сheсk-in with yоur finаnсes every dаy. …
- Сut bасk оn yоur sрending. …
- Tаke а lооk аt yоur inсоme. …
- Mаke а рlаn tо раy оff debt.
What’s the 70/30 rule?
The 70% / 30% rule in finаnсe helрs mаny tо sрend, sаve аnd invest оver the lоng term. The rule is simрle: tаke yоur mоnthly inсоme аnd divide it by 70% fоr sрending, 20% sаving, debt аnd 10% сhаrity оr investment, retirement.
Whаt’s the 70 20 10 Rule Mоney?
Bоth 70-20-10 аnd 50-30-20 аre bаsiс рerсentаge breаkdоwns fоr sрending, sаving аnd shаring mоney. Using the 70-20-10 rule, а рersоn wоuld sрend оnly 70% оf mоney eаrned eасh mоnth, sаve 20% аnd then dоnаte 10%.
Whаt is the 70 20 10 Rule mоney?
Bоth 70-20-10 аnd 50-30-20 аre bаsiс рerсentаge breаkdоwns fоr sрending, sаving аnd shаring mоney. Using the 70-20-10 rule, а рersоn wоuld sрend оnly 70% оf the mоney eаrned eасh mоnth, sаve 20% аnd then dоnаte 10%.
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