Today I’m sharing some tips on improving your finances. If you’re reading this, chances are, you have been scouring the internet for tips to help save money. On my own financial journey, I have found lots of little ideas, which added up to making a big difference to my finances after a year. Read on to find out my tips on improving your finances.

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Tips On Improving Your Finances

When I decided to look for ways to improve my finances… I noticed that almost every site tells you to work out your essential outgoings and regular incomings first. So that’s what I did…

Work Out Your Essential Monthly Outgoings

The first thing I did when considering tips on improving your finances was sit down and work out my essential monthly outgoings. This included all of my bills, fuel, food, etc. I then subtracted this amount from my total monthly income to work out how much disposable income I had each month.

Disposable Income

Knowing how much I had left after bills each month meant I could work out how best to clear my debts. I knew I had £500 per month available to use however I chose. So I opted to pay £200 of that off my overdraft. This would mean I’d have it paid off within a year. Also, I’d then have even more disposable income the next year. This was one of the most important tips on improving your finances I found.

Mortgage Tips

I found lots of useful tips on improving your finances from mortgage Advisors. The one which really stayed with me essentially said…

If you were to reduce your spending on non-essential personal items by £100 per month… You could use this money to pay off your mortgage early. So that means on a £130,000 30-year mortgage… The extra £100 per month could allow you to pay it off 10 years early, as well as save you thousands of pounds in interest payments. Knocking 10 years off your mortgage seems like a no brainer to me!

Consider Remortgaging

Alternatively, you may want to consider remortgaging your property if you have lots of equity in there, and need a lump sum to help you get your finances straight. It is essential to ensure you can afford the increased monthly expenditure and long-term implications if you do this though.

Paying More Than The Minimum Payment

I have a credit card, and for a long time, I only paid the minimum amount each month. Eventually, I realised that 80% of that repayment was covering the interest, so my balance was hardly reducing. In the end, I applied for a balance transfer credit card, which offered 2 years 0% interest on balance transfers. I paid a 3.5% fee for doing the transfer, but that was less than the equivalent of 2 months’ interest fees. I then paid the same amount back each month, and I will have cleared my credit card in full by the end of the 0% period – HOORAY!

You may also want to consider taking out a low interest loan to pay off credit card debt. It’ll give you a clear date in the future when you’ll be debt-free, so can motivate you more as you can clearly see what’s left to pay and when you’ll be out of debt.

Cutting Back

All of the above was achieve by cutting back on some activities, which were eating up a fair amount of my disposable income before. I haven’t totally given up on my treats though. I have joined Quidco, and have saved hundreds of pounds shopping via there for stuff like broadband suppliers, Christmas gifts and appliances for the new house. Additionally, I have been using groupon to get great deals on stuff like haircuts, days out with the kids and meals out for special occasions. It’s amazing the deals you can find online now!

Final Thoughts on Tips On Improving Your Finances

Finally, if these tips on improving your finances have been useful, check out my Finances category.