Many people often go through financial challenges in January; this is regularly caused by overspending during the festive season. Sharman Williams, an advisory partner at the Wealth Corporation argues that such financial woes are a result of lack of discipline and financial planning.
Most people borrow ahead of the festive season and this could take an entire year to repay the borrowed money.
Williams cautioned that, “The fact is such a situation is indicative of the culture of affluence that permeates society. Easy access to credit and the images of affluence that surround us on all sides spur the kind of consumer behavior that cannot be sustained.”
Meanwhile, Williams listed down a few principles consumers should employ in order to address their financial woes:
Enough: The first measure is desisting from bad debt by initiating a habit of living less than you earn. Don’t keep up with things that you can’t afford, it burdens your finances.
Budget: conduct an assessment of your debit orders and other financial commitments to see how much you will be left with. This will help you to ensure you don’t excess your spending and other areas where you can save. Make use of any other budgeting tools which suits you best.
Debt: When in debt, you should pay off the debt with the highest interest rate. Prioritize paying off debt over discretionary spending, it will make sense late.
Save: By saving, you are helpfully preparing for your future self. Maintain an emergency savings account which you can access in case of any unforeseen circumstances which can invariably arise.
Review your financial plan: It’s a key to guaranteeing yourself that when your circumstances changes, your financial plan changes as well. Also remember that your will is part of this aspect; as such, it reflects your current circumstances and that you insurance cover is adequate for any changes in your life.