When money is tight, we are at an increased risk of getting into financial trouble. The good news is that with careful budgeting and making sure that we are prepared for all occasions, we can protect our financial present and future. Whether you have made mistakes in the past that are affecting your current situation or are trying to find a way to make ends meet without having to deal with debt, you will find the below guide useful. Plan ahead, monitor your income and expenditure, and react to changes as soon as possible to protect your budget.
1. Regular Maintenance
One of the main sources of money emergencies is your home. When your boiler breaks down, or you need to upgrade your electrical system, buy a new dishwasher or washing machine, you can stretch your budget too far and get into debt. The good news is that you can save money by signing up for a regular maintenance plan, so you can find and address faults before they would cost you too much. While taking out extended warranty can be expensive, you can sign a deal with a local company to check your heating and air conditioning system and carry out the necessary maintenance every six months, so you spread the cost and avoid breakdowns.
2. Emergency Insurance
No matter if you have a home insurance already, you are likely to be paying the first few hundred dollars out of pocket, and this can have an impact on your monthly budget. Some repairs simply cannot wait. If you are left without heating, air conditioning, or have a leak, an emergency insurance will cover the cost of the repair, and allow you to get on with your life. You will not have to pay the excess if you have a home emergency insurance, but there will be a limit to your claim. Still, this solution is much better than claiming on your insurance and seeing your monthly payments going up.
3. Protecting Your Car and No Claims Discount
Having a car insurance is a great way of dealing with disasters. When you face a challenging situation after a car accident, and don’t know how to get to work in the morning, a car insurance can help you. However, if you have an older car, even a small bump can tempt your insurance company to write off your vehicle, and you will be asked to pay a higher price on your future insurance. Always ask an independent car repair service and see whether it is wise to make a claim and inform your insurer, or you might end up with a much bigger monthly bill and have your car written off.
4. Phone Repairs
We all love our phones, and feel lost without it. If yours get damaged or broken, you might have to pay hundreds to get it fixed. Alternatively, it will simply not be worth to fix it, and you need to invest in a new one. The good news is that you can take out a phone insurance to cover the screen and the software. The insurance can sometimes even pay for data recovery, so you don’t end up losing all your contacts and messages.
5. Side Jobs
Living on a tight budget is like dancing on thin ice. In case you have to scrape the bottom every month to pay all your bills, it might be time to get a side job or take on a few gigs on the internet. Whether you have a good voice and want to offer voiceovers for videos, or are good with social media, you can work an extra few hours a day and make more money, so you are more comfortable every month.
6. Be Prepared for Rising Costs
Nobody can predict the future, but we can see the signs of changing times. If you suspect that your living costs will rise, or you will have to drive more to work, you can start seeking cheaper alternatives. You don’t have to carry on doing things just because you are used to them. Buying your lunch at the corner shop for 2 dollars every day seeing the price going up to $4.50 in a few years should tempt you to find another store or make your own sandwiches.
7. Compare Prices Regularly
You’ll also have to make sure that you are not paying more than necessary for services and products. Compare all your financial products, insurance, and service prices on the internet every few months to make sure that you are getting the best deal possible. Price comparison sites can save you hundreds of dollars every month. Just because your current satellite TV provider increased your price, you don’t have to stay and agree the terms. Find a better deal for your utilities and look out for opportunities to adjust your budget.
8. Avoid Expensive Credit
The secret of staying in the black and avoiding the red is saying no to easy access and expensive credit. You might be tempted to take out a short term emergency loan from the high street, but this can make you land in serious trouble. Talk to your bank instead and ask about your overdraft options, so you can get access to extra funds without having to commit to a high interest finance.
9. Keep an Eye On Your Credit Rating
Another important thing people forget about is maintaining a good credit standing and keeping an eye on their credit rating. You have to be able to secure the best possible money products for when you need them, and for this you will need a solid financial history. Sign up for monitoring services, so you can check when it is the best time to refinance and lower your interest charges, and make sure that every detail on your credit file is up to date and correct.
If you would like to protect your budget, you need to be prepared for emergencies and monitor your income and outgoings. In case making ends meet is a struggle every month, it might be time to set up a side business to increase the amount of money coming in and feel more comfortable about your finances.