Set a budget
You’ve probably heard it a million times before, but it’s worth the mention as setting a budget is one of the easiest things you can do to regain control of your finances. A budget should help you determine how and when you are going to spend your money. It can be as simple as listing your fixed expenses (regular bills, your mortgage/rent etc.), determining how much you can afford to spend on other necessary items and tracking your future spending. However you choose to do it, creating a budget is a great place to start when you’re feeling the financial pinch.
Cut down your expenses
Once you have a budget in place and you can see how your money is divided, this may also be the opportune time to assess where you can make some savings. Making little changes in your daily routine could save you money in the long run. For example, bringing your lunch from home rather than eating out. Even your weekly grocery shop could be an opportunity to rein in the spending, here is a list of 15 ways to save money on your groceries.
Start a savings account
It is estimated that 2.6 million Australians have little to no savings. Essentially, no buffer for a rainy day. If you’re currently without a saving account, it may be a good idea to start one. You never know when you may need to dip into an emergency fund. Consider having a saving goal to help you stay motivated. You’d be surprised how quickly your savings grow when you regularly put aside part of your paycheck into a savings account. Also, witnessing your growing saving could go a long way in relieving you of financial stress.
Protect your income
It may seem counter-intuitive when you’re stressed but sometimes thinking of the worst-case scenario could help you prepare for bumps in the road. For example, if you were to become ill or are injured to a point where you are unable to work for an extended period, where would that leave you and your family? Without your regular income would you be able to cover your mortgage/rent, bills, schools fee etc.?
Income protection is designed to replace your lost income for a period of time if you are unable to work. Depending on your occupation, age and smoker status, income protection could cost as little as $1.40 a day – cheaper than your average takeaway coffee. Benefits are often paid in monthly instalments and you could receive up to 75% of your before-tax income. In addition, to possibly helping you get back on your feet, income protection can also provide invaluable peace of mind.
The results in the table below are based on a 30-39 year old female accountant who is a non-smoker. The results are sorted by star ratings from highest to lowest and with links to provider’s websites. For a comparison tailored to your occupation click here.
With saving money in mind a good place to start may be to compare income protection policies and collect quotes to see which policy suits your needs and is value for money. We always recommend that you read the Product Disclosure Statement carefully for any policy you are considering.
Hopefully, with a few little measures in place that may go a long way to making you feel more confident about your financial situation.