Are you spending your way into debt?
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Step 5: Manage your mortgage
With all the interest rate rises that have been taking place recently, if you don’t stay on top of your mortgage you could pay dearly. Rates recently rose to 5.5% – and if you’ve been on a special mortgage deal that has ended, you could be paying significantly more than that. By shopping around you could save yourself significant amounts of cash.
Step 6: Quit bad habits
If you’re a 20-a-day smoker you could be wasting nearly £2,000 a year that could be helping to bolster your finances instead. Similarly, can you really afford that daily latte?
Step 7: Make a budget
While getting your finances under control is largely about cutting back on how much you spend, it can really help to have something to aim for. Sitting down and drawing up a budget can really help you set realistic financial goals – and see just where your money goes. Check out National Debtline’s interactive budget planner for more help.
dealing with debt
Step 8: Get a better bank account
The flipside of the cost of borrowing going up is that you can get better interest paid to you on any money you happen to have in the bank. But some lenders are not as generous as others when it comes to passing on the benefits – you need to stay on the ball to make sure you’re getting the best deal.
For example, Alliance & Leicester is currently offering interest of 6.5% Annual Equivalent Rate (AER) on its Premier Direct current account up to a total of £2,500, while the ICICI Bank’s instant access HiSAVE account pays 6.05%, if it’s a savings account you want.
Isas are also a great way to save because the interest you earn is tax-free. Egg currently has a mini cash Isa paying 6.05% AER.
