New Year resolution time. And as well as trimming up or get fitter , no doubt you are also looking to tighten the finances save more, get ahead faster.
Here are a couple of quick tips that I have seen from listening to my most successful clients in the last 8 years.
- Track your spending
Simple as it sounds, if you do not know where you money is going; it is very difficult to get ahead if you do not know how much you are spending and where. With the almost total use of cards it is now a bit easier tracking things online. The people getting ahead have a pretty good handle on where they are spending their money.
- Form a budget
I am a believer in a budget, but not necessarily painfully accounting for every dollar. A rough outline of where you would like to spend your money is a good start. There are a number of online tools sorted.org.nz as an example to assist here. A budget allows you to plan for how much you can save.
- Focus savings on debt
Aside from KiwiSaver, the best place to save is to pay down your personal debts. Even at 4.5% mortgage rates you would need to find an after tax return of more than this to put your monies somewhere else. Very tough in this environment. Once your mortgage is well managed, you have a number of options to really grow your wealth.
- Earn more income
Ironically this is an underemphasised way of getting ahead. This also seems obvious, but, particularly if you are young, an increase in income over a long period of time can have a tremendous effect on your long term financial position. This is particularly true if you do the above, track your spending, budget and pay down personal debts.
Simple? But not easy. As with any sort of goal, you need to have the desire to follow through, regularly review, and be flexible over the long term