With Christmas properly behind us and with two month’s pay packet in our bank account, now is the time to have a good look at our finances for 2015 and make sure that we are being as sensible with them as we can be and getting out of debt.

Do you live on your overdraft or do you rely on your credit card every month? If this is the case then it may be time to take a hard look at your finances and get your spending under control. It’s worth doing in the long term as you may find that you can start to save money and you can pay for those emergencies without using your credit card.

So here are a few ways of getting back into the black!

Look at it!

Take your head out of the sand and have a good look at your finances. Sit down and get all the paperwork out. Find out exactly how much you owe and to whom. As a rule, if your debt repayments take up more than 20% of your total income then you really need to take steps to cut back.

Make a budget

Once you know how much you own, you can then set a monthly budget schedule for repaying those debts. Don’t try and do it all at once because that could put you into a deeper mess. Work out a realistic monthly payment that you can afford. Talk to you creditors to see if you can work out a payment budget with them. Many welcome this step as they realise that you are serious about paying back the money you owe.

Think before you spend

Do NOT borrow any more money or take on any more loans or credit cards until you have paid back what you owe.

Use cash

Each week take out a set amount of cash, which is within budget and covers your basic needs like food, petrol and bills and put your card where you can’t get at it.

Bills

Look at all your outgoings and see what you could save money on. You could switch your utility bills to save money and pay by direct debit as most of them give you discount for that. Look at your home and car insurances and switch annually to save money. Also look at your TV, broadband and phone and see if you can save money by switching or splitting providers.

Credit cards / Loans

Look at switching your credit card or loan as there are providers with much better interest rates. One way to get rid of your card altogether is to switch to a Balance Transfer card which will give you a 0% interest rate for a set time period. While you are in that time period, try your best to pay off the whole card. If you can’t then after the set time period, look at switching again.

Store cards

Who has them anymore anyway? They charge the highest rates by far for any credit, they the worst way to build up any debt, so get rid of them now, cut them up and start to pay them off. It’s worth remembering that some bank accounts offer cash back in certain stores, so you can earn yourself money by shopping.

Bank account

Look at your current account and see what you are getting from it. Also look at the interest rates you are paying on your overdraft or any payments you are making for added extras that you may not be using. There are lots of online bank accounts as well as the ones we know well, so shop around to see what you can get.

Savings

If you have any savings at all, look at the interest you are getting from them. You could probably find better rates if you switch to another provider.

Mortgage

The biggest expense you have each month is most likely your mortgage, so it is important that you get the best possible deal. It is always worth, in the first instance, going to your current mortgage lender to see what they can do for you, or going to see a financial advisor who can scour the market for you and work out if it’s worthwhile to switch.

Protection insurances

It’s worthwhile looking at your insurances such as your mortgage protection, critical illness cover and income protection as you could save money here. It may be that what you took out several years ago is no longer applicable to you, or you may be under-covered. It’s worth doing the review to make sure that you have adequate cover but you could also save some money if you have a savvy financial advisor who can find the best product for you.

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