It’s nearly January and many of us will be thinking about how we can prepare financially for the New Year. Many of us will have credit card bills and debts due to overspending at Christmas and over the holidays, and it’s a good idea to plan ahead on how we’re going to get our finances back on track.
Set yourself some goals
In order to get your finances away from the red and back in the black, you need to set yourself some attainable financial goals. Think about what is setting you back financially, do you have any high interest debts that you want to pay off first? Or is the interest that you’re paying on your credit card too high?
Once you know what you want to change in order to improve your financial situation, you can then think about how you’re going to do it.
Paying too much on your credit cards?
If you feel that you’re paying far too much interest on your credit cards, you could consider a balance transfer. There are some great balance transfer deals currently on the market that allow you to transfer your balance to a new card, and then you can avoid paying any interest on your balance for up to 20+ months!
Transferring your balance using this particular type of card can save you a lot of money, and it gives you the freedom to pay off your card when you have some spare cash.
Are your debts holding you back?
If you think you’ll be struggling to make headway when paying off your debts in the New Year, have you considered consolidating your debts via a low interest loan?
There are some loans that are offered with lower interest rates than overdrafts or credit cards, so it may be an option you should consider. To try and find the best low interest loan for you, make sure you shop around, price comparison sites like moneysupermarket.com allow you to compare the best deals current available.
Do you use the right savings vessel?
Is one of your financial New Year’s resolutions to save money in 2012? Do you have the right savings account to do so? There are so many different types of savings account on the market that it can often be overwhelming when trying to choose one over another. Here’s a quick summary of some of the more popular savings accounts:
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Easy access savings – Easy access accounts are regarded as the most flexible as you can deposit and withdraw your money whenever you want.
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Fixed rate bonds – These are fixed rate savings accounts that offer you a higher rate of interest, however with a bond your savings are tied up for the duration of the bond and you will face penalties if you want to withdraw cash.
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Notice accounts – These normally come with quite a good interest rate but you will have to give notice to the account provider before you can withdraw any money, the notice period can sometimes be up to 120 days.
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Cash ISA - Tax free savings accounts are becoming more and more popular. You can save up to £5,340 tax free in a cash ISA savings account during this tax year.