5 Ways To Manage Money

Sep 7, 2020 | Aussie Nurse

When life’s ‘up’s & down’s’ randomly happen- like the car breaking down and needing repair, the need for a new laptop when it stops working or even worse getting a ticket for going through the traffic lights that were changing so quickly to red- unfortunately it happens now and then

With many of us living pay cheque to pay cheque and when those unplanned expenses occur we may rely on credit cards or small loans to borrow an amount of money with all the good intentions to pay it back later. But these small amounts add up and may cause a person to owe more than they are able to pay back and become trapped with debt.

 

To avoid getting into debt having some ‘emergency savings’ in the background for these unexpected expenses can offer some breathing space and stop the money related ‘headaches’.

Here are 5 suggestions to manage money- 
 
1. Budget on a monthly basis – 

Keeping track of your expenses by having a budget is a practice and it justifies your spending. Tracking with a budget helps to see what money is coming in and what money is going out, it helps to estimate everyday living costs such as essential items i.e. mortgages/rent, transport, food and leisure.

Keeping track of what is coming in and what is going out seems daunting, overtime it will become more natural to you as it will become a guide to what is important for your individual spending decisions. 

There are many useful apps that can help – 6 savings & budgeting apps worth checking out in 2020- https://www.canstar.com.au/budgeting/budgeting-apps/ 

 

 
2. Getting rid of credit card debt – 

Credit cards are a common way to accumulate debt and they can have the highest interest rates to pay back. Paying back the owing amount becomes difficult when the regular minimum repayments are not met, the remainder owed will start to collect interest and could cause being charged with late fees.

Currently, new interest free credit cards are being introduced but they may have an annual fee, which is something to watch for.

ASIC MoneySmart’s  credit card calculator is useful to see how long it would take to pay off your credit card with only the minimum repayments versus regularly paying more than the minimum required.        

 

 
3. Managing subscriptions- 

Subscriptions cost a small amount every month that can be easily forgotten about when they are not being used anymore and may be slowly leaking your money away. Examples are paying for music subscriptions, product box-set subscriptions, app subscriptions etc. They are small spends that are a bit sneaky and may cause over-spending.

 

 
4. Set a target for savings in an emergency fund-

For the times that the unexpected happens having an emergency fund will be there if you need it for example- something in the house needs repairing or even to cover unforeseen medical expenses.   

An emergency fund is an additional savings account that is separate from your regular account, it is a boost of money that is ‘behind the scenes’. Each time you are paid you can decide an amount that can be taken out of your bank account automatically. This function is is automated and effortless, once it is set up your money is ‘out of sight’ and it reduces the temptation to spend it.

 

 
5. Using price comparison websites & apps 

This is the most frugal of the suggestions, it is all about ‘watching the pennies’ and finding the best deals. There are many price comparison websites for flights, hotels, white goods, home loans, insurances etc etc. Grocery comparison apps are only new and hopefully with time they will get better.

 
 
Goals-

When managing money having a specific goal in mind to work towards gives an incentive to set aside savings for a specific reason like saving for an overseas holiday, saving a deposit for a home or even saving for a great pair of new shoes- Why not !!

A budget helps to track expenses and helps a person to understand their individual costs of living, there are so many resources and tips to help you prepare and to avoid getting caught out with debt. There will be times when the budget is not met and thats ok as saving is planning for the future and the up’s and downs are part of the journey.

 
 
Financial stress- 

Being worried about money is very common and difficulty in paying loans and debts when they are due can cause financial stress, it can affect your personal relationships and in turn your health.

When managing your money its worth getting professional help and if you feel overwhelmed by debt, it’s very important to seek help and support as early as possible by contacting a financial counsellor on – National Debt Helpline is a free & confidential helpline on 1800 007 007 (Australia)

 

Resources- 

 

Support- 

(Photo by Josh Appel on Unsplash)

 

DISCLAIMER-
Aussie Nurse does not provide financial advice, please do your own research and gain advice from appropriate financial professionals, as to tailor to your personal circumstances.
 

 

“Money is a guarantee that we may have what we want in the future. Though we need nothing at the moment it insures the possibility of satisfying a new desire when it arises” 

– Aristotle

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