Asteria Lending Inc. Unit 305 3/F 6762 National Life Insurance Bldg. San Lorenzo, Ayala Ave. Makati City
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As the decade comes to a close and we begin to reflect on the first 20 years of the 21st century, many people will be thinking about ways to manage their finances more effectively in the coming year. Whether you’ve taken out personal loans you didn’t really need or fallen foul of the excruciatingly high rate of interest charged by some payday lenders, there’s almost certainly a few things you can do differently when it comes to managing your money in the next financial year. Here’s Asteria’s guide to managing your finances in 2020.
This takes time, honesty and discipline, but it will be worth it. Look at your spending habits over the last 12 months and make a realistic record to reflect on where your money is going. Include impulse buys, subscriptions, cash purchases and contactless payments. Nothing should be omitted. When you have done this, break down your spending into categories, such as “food, household items, entertainment” etc. You may be surprised which categories come out as the most expensive.
If like many parents, you allow your children access to a certain amount of money each month, you can take advantage of app-based technology to help prevent overspending. Most banks now allow you to set up “folders” or “wallets” for named individuals, so you can give your family the experience of managing their own money from an early age. Setting limits is important and its also a good idea to explain that once the money in this account has gone, that’s it, there’s no more. It may take a few months of practice, but this kind of freedom mixed with the right amount of responsibility can be a great way of teaching young people how to get the most from their money in the long run. This kind of feature can also work for adults, too. Though even if you don’t use app-based technology, it makes sense to set a personal budget and stick to it.
Everybody can benefit from saving, no matter what their financial situation, so try to make this a habit in 2020. From something as simple as a jar for your loose change to a dedicated online savings account, there are all kinds of ways you can make saving easier for yourself in the 21st century. There are a range of apps available that will put money away for you without you having to think about it. Even a few dollars a month can be enough to for a little treat at the end of the year or a little emergency fund to keep the wolf from the door. A good way to start is to make a note of when you’ve been particularly good or self-disciplined. If you decided against that impulse buy while you are standing at the till of your local grocery store, note down how much this would have been and put the same amount of money into a savings account. You may not remember to do this every time, but it all counts and over time, you will notice a real difference.
It would be nice if retailers charged us all a fair price but unfortunately, the cost of many products can vary quite dramatically. No matter how badly you want something, never decide to pay for it until you have compared prices. Unless it’s a very specific item with only one manufacturer, the chances are, you can find a lower price than the first one you see. In 2020, price comparison is an industry in itself, with many free sites available to help you check the competition before parting with your heard earned cash. Whether its new sneakers or kitchen appliances, make the market work in your favour by being a picky customer. You deserve quality and you don’t have to pay over the odds for it, either.
When you apply for a loan or a credit card, several agencies share your details and personal information in order to make a decision. Many people don’t realise this, but if you apply for several cards or loans at the same time, you stand to damage your credit rating and significantly reduce your chances of being accepted. Limit applications for loans or any other type of credit to one per month, or fewer if possible. Credit ratings can improve quite quickly but if you are seen to be continually applying for new lines of credit, the lenders will begin to see you as an unacceptably high-risk customer. Overall, this will damage your reputation and have a knock-on effect for your finances.
You can do this in all kinds of ways, from online businesses to part time work on an evening or weekend. The key to making this sustainable is to find something that you enjoy that you can turn in to a job. Even a few hundred dollars a month can make a big difference to overall lifestyle and if you are able to generate this from something that gives you pleasure; it won’t feel too much like actual work. Always ensure you’re being paid the right amount at work, too. Though most employers diligently follow all employment laws and regulations, some of them can be a little unscrupulous. Negotiating pay rises and bonuses is skill that takes time to master, but if you are doing a good job and there are funds available, there’s no reason you can’t increase your income this way, too.
This is the single most effective way of saving money out there. It won’t feel great at the time, but if you can get into the habit of simply refusing to indulge your impulsive side, you will see a marked improvement in your finances over time.