Sunday 18 August 2013

Tips For Taking Control Of Your Personal Finance

By Randy Best


Most people say that money can't but happiness, however, it can surely purchase peace of mind. It helps us sleep better during the night, and it greatly lessens the stress we feel daily. A premier cause of depression is financial disarray. Having your finances in good shape will make you much happier, so use the tips in this article to take back control of your money.

Consult and review your credit reports if you are having difficulty qualifying for credit cards, home financing or any other kind of loan. Information that is outdated can have a negative impact on your overall score. If you find errors, send letters to the credit bureaus to have them removed.

As you work to repair your credit, be aware that your credit score may drop during the process. Don't panic if you notice a slight drop in your score. Keeping good information in your credit report will help your score increase over time.

Instead of using one credit card and almost maxing it out, try to have 2 or 3 cards with lower balances on them. When you're paying towards two separate payments, your interest payments won't be as high as they would if you were paying off a credit card that's been maxed out. Having two credit cards can actually hurt your credit less if you manage them properly.

In order to maintain strong personal finances, always pay bills in full each month. When you pay all of your bills on time, you are starting to manage your finances properly and know how much you can spend when you go out. You will spend less time stressing over whether or not you have enough money to cover bills if you need to make an unexpected purchase.

Many spend significant sums on a weekly basis thinking they will win the lottery, but it makes more sense to put that amount into savings instead. This is a better option because it will grow over time versus being wasted on a gamble.

Do not borrow money or start new lines of credit unless you have no other option. In some cases credit may be needed, but it's better to save money for making large purchases and not incurring debt. A few of the things that take borrowed money are cars and houses.

On the night prior to payday, put some reserve cash aside, and make sure that is all you spend over the course of the weekend. When you get your paycheck Friday, don't mess with it. This will allow the money for bills to still be available on Monday.

If you currently have a full-time job, one of the things that you can do is to get a job on the side. Consider your talents and turn them into a profitable and enjoyable sideline. Getting that extra income can really add the boost you need to your finances.

Some debt is actually good for your credit score. For example, buying real estate is a good debt. On the average, real estate increases in value and you can save at tax time by using mortgage interest as a deduction. Another king of good debt is college loans. Student loans have easy to manage interest rates and don't require payments until the students have moved past graduation.

Credit card balances play a big role in your FICO score. The higher balances you have, the more negative your score will be. Once you begin to whittle down the balances, your score is sure to rise. All balances should be under 20% of any stated credit card maximum limit.

Go over your bank statements carefully. This way you can keep an eye on any increases in monthly rates or fees. People often forget to review their bank statements and pay more than they realize. Read your statement carefully each month for the reason.

With any luck, this article should have helped you learn more about personal finances and how to turn them and your life around. Getting in good financial shape may take time, effort and require you to make a few major changes, but in the long run, having manageable personal finances will lead to more peace of mind and much less stress. You will find that you are happier in the long run!




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