Control Your Finances
By Compass Wealth, Our choice for a financial advisor Oshawa
Many people often face the problem of running out of cash before their next paycheck comes. This is typical because they lack the time in organizing their outgoings and incomings that they end up wondering where their money went.
Check out the following solutions that can help control your finances the easy way:
List Your Monthly Bills
Your monthly bills are composed of things like rent, water, electric, gas, and council tax. These bills are often the same amount each month. List down all your monthly bills together with the amount you pay for each one. Add up the amount so you will know how much your total expenses are every month. If your bill ranges between two amounts, write the amount that is higher of the two. You can find these amounts by checking your bank statements or bills.
Some gas and electric companies provide an option of having a single payment every month. This allows them to monitor how much electricity or gas you use and adjust the monthly payment as necessary. Taking this option is good for you so you just need to add an extra amount when they decrease or increase the direct debit.
Schedule Direct Debits
These direct debits give companies a chance to take money directly from your account once your bill reaches its due. When you know the amount you have to pay on your bills every month, you can then leave this amount in the account or you can transfer its full amount to a different account if you wish to use a different one for your bills. The companies will let you know if there are any increases to let you adjust your payment amount accordingly. If possible, you can pick the same day for your payment to come up if you are paying monthly or at least the next day. This can be of great help if your outgoings all come out of just one account.
Multiple Bank Accounts
You are allowed to open multiple checking or current accounts in your bank that you can use for different purposes like bills and spending. Use one of these accounts for monthly bills then set up the direct debits coming from this account. You can transfer the total amount of cash you will need for paying bills into the account once every month so you will know that your bills will be sorted monthly. You might want to have a small overdraft on this account if the need arises.
You can use another account for general spending needs like fuel and groceries. You can transfer your salary to this particular account so once you transfer the bill, the rest will be for your other expenses. This account can be used as your savings account where your money can stay and you just spend only what and when you need it. Anything that remains after payday can be classified as savings.
You can also have a different savings account wherein you can transfer a set amount every month or do it automatically with a standing order. You can also manually transfer the left over from the previous month.