Conquering debt in 2021 will not happen overnight, it will be a gradual process with plenty of hurdles and learning curves. Once you have mastered the art of financial planning, it will not just be this year that you conquer your debt problems, you should never fall into debt again. Now that you’ve assessed your debts, began budgeting and switched providers it’s time to figure out how to master financial planning.
So, what is financial planning? Simply put, it’s budgeting but over a longer period of time, for example, a year. It’s identifying when you have to pay for a specific additional expense at a certain time of the year and ensuring that you have budgeted sufficiently during that month – or the months leading up to it.
To help you do this, we’d recommend buying a calendar and marking each month where you expect specific expenses to arise allowing you to digest these additional costs more easily. When is your car’s MOT? What about birthdays and special occasions? The festive period? They’re the same time every year; mark it on your calendar to visually prepare you for them, then think of cutbacks you can make during that month – or seasonally – so that you can afford these additional costs without applying for another credit card.
We all have several New Year’s Resolutions in mind, but by the end of January, we’re back to our old ways because we’ve tried to change too much over a short period of time. It’s much easier to adjust your spending habits one-by-one so it’s not a shock to the system!
Check out our seasonal tips for saving money throughout the year:
Feel like you’re ready to take the next step? Look out for our next article: Debt clearing methods vs Debt solutions!