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Living away from Home for the First Time? Here is how you can keep your Finances on Track

So, you have taken the bold decision to fly the nest and assert your independence? It’s a great time to start considering grown up and adult choices. After all, now you are fully fledged adult seeking out your own home, it’s time to start growing up. Of course, we only mean growing up in the financial sense. The rest of the time you can be as immature as you like.

Having a keen eye on your finances and being able to exercise control is one of the most empowering things about living away from home. Whether you live at home or not, having financial restraint and knowing how to budget money is an important skill. It will certainly stand you good stead for the future.

So, now is the time to make sure that you are efficiently controlling your finances. It can be difficult at first, but once you know how, you will soon have a financial process in place that will see you on the road to riches. Well, sort of.

debt-management

Check Your Balance

The thought of seeing how much money you have can be terrifying, but now is the time to check. How much money do you currently have? How much money do you take home at the end of the month? Now, establish the due dates of your bills and utilities. A great way of figuring out how much disposable cash that you have is to work out the number of weeks in the current and divide this by your take home pay. This will give you a weekly total of how much money you have to play around with. This is one of the best ways to budget if you are paid monthly after all you don’t want to be living like a king for two weeks of the month and then eating toast for the remainder of the month. Be sensible and work out a weekly budget.

Week to Week Costs

Of course, not all finances come out at the beginning or end of the month. You may need to consider your weekly expenses too. Usually, this is the cost of living and what you are spending your money on may differ week to week. Typically, on a weekly basis, you will buy food, fuel, travel passes and entertainment. As some of these are fixed rates, it should be easy to start compiling a useful budget. However, some costs will vary week to week, so make sure that you are prepared for these additional costs.

Track. Monitor. Control

Check your balance and your statements on a regular basis. With access to apps and internet banking, tracking your finances has never been easier. Staying on budget is easy once you have a tighter control over what you are spending. For some, they find it easier to take out money from the cash point and using the allowance for the week. However this can be fraught with problems. Your bank needs to see money in the account at all times. This is so that they can track your credit rating and the like. So, do make sure that you are leaving something to avoid a negative balance.

Good Debt versus Bad Debt

Whatever your viewpoint on borrowing, debt can is a positive thing. It can assist with your career development and can ensure that you have a roof over your head. There is a great debate over what is consider bad and good when it comes to matters of borrowing.

In short, good debt is where you borrow for your mortgage, student loan and car. After all, these can be considered expensive, but essential items. If you are living from home for the first time in a property that you are buying, you will have needed to get into ‘debt’ in order to borrow for your home.

Of course, there is bad debt. This is where people spend exuberantly and with wild abandon. This means that credit cards, payday loans and unnecessary borrowing are sought just so that you can have ‘stuff’. Many people pay for holidays, brand new cars and borrow for things like nights out. Let’s be frank, this is not a good spending habit to have and can have a detrimental impact when it comes to managing your finances.

Start looking into debt management schemes, such as Trinity debt management. This can ensure that you no longer sacrifice your financial health for things that you don’t need. To keep your financial affairs in good standing, you need to be proactively managing your debt in a good way. Debt management courses are the best ways to do this. Debt management processes will assist you with making payments to creditors and ensure that you are deferring and defaulting on payments. In the long term, this will stand you in good stead, so do take advantage of these kinds of services.

Saving for the Future

The future may seem like a long way off, but putting a little something aside is a great way of making sure that you don’t face financial hardship. If you are in debt, you should strive to pay this off. After all, your savings will be rendered obsolete if you have debts in place.

Once you have cleared your loans and credit agreements, it is vital that you start saving. Even a small sum a week can add up. Set up a separate bank account and save cash away from your daily living expenses. In the event that things in your new home break or need repairing, you don’t have to go into debt to make sure that you can fix them. What is more, if you do want to splash out on a luxury holiday, you don’t have to put it on plastic. You will have the cash ready to use.

Keeping a clean bill of financial health will serve you good stead for now and the future. Moving out of your family home for the first time doesn’t have to be a difficult or painful task. It can be the start of a bright and happy future.

About Stephanie

Stephanie Rosen is a financial market analyst and a blogger. She writes about stock market and investment opportunities around the world. You can find her latest ideas on here. Just signup our news letter today and receive regular updates of Stephanie.