I don’t know how many of you are sticking to your New Year financial resolutions but I know for some they may be a struggle
The reason for this might simply be that you are trying to take on too much. Some people set themselves up for failure by trying to accomplish too much in too short a space of time; others don’t write down what they want to achieve and then forget about the goals.
I am very much a ‘to-do’ person and I know that if I write something down on my, to-do list, I have to complete it.
It sort of annoys me into completing the task so I am going to give you a selection of eight financial to-dos that I want you to accomplish this month.
All eight may not apply to you, maybe only one or two, and that’s fine but I want you to write down the task you need to complete by the end of this month, and write it somewhere visible, somewhere where it will be a constant reminder to you. So, if that is sticking it on the fridge, in your wallet or wherever, just make sure you do it.
Set up a new savings account
Did you want to save this year for your summer holidays, a new car, a deposit for a house? Whatever your reason is, if you haven’t set up a new account then please, do.
It will take just 10 minutes out of your day. Work out how much you need and by when and then start saving that amount each day, week or month. And the easiest way to make sure you stay on track and avoid temptation of spending this money is by having it deducted from your income so ask your employer if they can arrange this facility for you.
Carry out a credit check on yourself
You should be doing this every year just to make sure that the records held by the Irish Credit Bureau, on you are correct.
It will cost you just €6 to do this (submit your request on-line at www.icb.ie) but it is a very important exercise to carry out. And for those in arrears it will also show you what your lender is saying about you to others and this is very important to know particularly for those who have had their mortgage restructured. What effect is this having on your credit rating?
Review your life assurance policy
Don’t assume what you are paying each month can’t be improved upon. In most cases I come across, it can be. Get out your policy document and have someone your trust review it for you.
You may have the wrong type of policy, you may not even need the policy you have but unless you investigate it you will never know. I met a gentleman last week who was paying €78.56 for a mortgage protection policy when all he needed to be paying was €54.50.
A saving of €23.06 may not seem like a life changing amount but better in his pocket than the life companies and the €276.72 he saved this year will pay his annual property tax bill in March.
Save rather than spend every fiver you have this month
I want you to try to not spend a five euro note this month. Instead I want you to put it into a glass jar or an envelope. Every time you have a fiver in your wallet or purse or you get it in change from buying something, you can’t spend it. Put in into the jar and at the end of the month see how much you have saved – you might be surprised. One woman, I read about did this and over three years she saved apparently $12,000, so it works but you have got to be disciplined. Try it for the month of February and see how you get on.
Move money from your current account to an account that is earning more than 0%
I meet people all the time who have way too much in their current account earning little or nothing in interest – it is actually costing them money to have it on deposit.
Stop, leave the amount in your current account that you need to, to avoid paying fees, with a small buffer if you want, but any excess move into a fixed term deposit account or an online account. You can earn twenty times as much in interest.
Move money into your current account to avoid paying fees
If you haven’t the time or energy to move current account providers, then move money that you may have on deposit with say your credit union or any institution for that matter where the interest rate you are earning is poor.
If you want to avoid paying fees with the two major banks then you need to deposit and keep either €2,500 or €3,000 in your account at all time. And whilst you will be earning zero interest, on the up-side you will avoid paying up to €170 each year in fees.
Look at your monthly budget again
Look over what you spent your money on last month. Sit down and spend 10 minutes reviewing where your money went. And if you don’t have any system for tracking your cash flow, make this the month that you set one up.
Knowing where your money goes each month, believe me is the key to improving every aspect of your financial life.
Make a will
If you die without making a Will (which is termed dying “intestate”) the law will decide what happens to your estate. Unless your circumstances are very straightforward, this could leave your loved ones with a financial nightmare.
Do you know what would happen to your children if you and your partner were to die? They become wards of court and a judge will decide who will be their guardian. By making a will you make provision for how they will be brought up and by whom.
Put this on your to do list and make it your goal to complete it by the end of the month. It won’t take that long and is very inexpensive so contact your solicitor and ask them what they need from you to get this in place.