Most of us simply want to be able to save more or spend less, but you may also decide that this is the year you want to grow or invest the money you have. Here are some tips on how to reboot your finances:
Always pay yourself first.
We’ve all heard this many times – you can’t acquire wealth if you don’t save regularly. Keon Chee, director at Legacy Planners, an estate planning company, suggests saving 20 per cent of your salary every month. “Keep doing this and you won’t miss it after a while”.
Work towards paying off your most expensive debt first.
If 25 per cent of your total debts are tied to your credit card, six per cent to your insurance, and two per cent to your mortgage, and you just received your year-end bonus, then it’s clear that you should pay your credit card debt first, says Keon.
“If I had a way to borrow on my insurance company to pay my card debt then I would, and I would never pay down my mortgage for the time being since it’s the cheapest debt. I would then ask my credit card company to make an automatic deduction from my current or savings account every month.”
Want to invest? Start small.
Don’t think, analyse or stress out too much about it, says Keon. “Follow American billionaire Warren Buffet’s advice: You won’t make millions yet but you need to take the crucial first step. You may also wish to work with a financial advisor to help you with your financial goals.”
A version of this story first appeared on Her World.