Spring clean your finances
As the days warm up for Spring, you’re probably thinking about clearing out the garage, giving the fridge a good spray n wipe, or de-cluttering the wardrobe. But don’t forget about your finances! There’s no time like the present to assess your finances and get everything squeaky clean.
Update your budget
You might already have a budget in place, but new expenses might have creeped in, or you might just need to double check everything’s on track.
If you don’t already have a budget, now is the perfect time to start! First step is knowing exactly how much is coming in, and how much is going out. Sit down with your bank statements and categorise your expenses so you know exactly where everything goes. From here you’ll be able to prioritise and decide exactly what costs need to cut back.
Clean out your wallet
It’s an easy one, but so satisfying! Most of us have a bunch of useless cards and old receipts filling up our wallets. Take 5 minutes to clear out anything you haven’t used in a while – your pockets will be lighter and you’ll swear never to leave an unwanted receipt in there again.
Consider consolidating your debt
A debt consolidation loan replaces multiple existing loans with one easy loan. It’s most often used to combine credit card, personal loans and other high interest debt. Done right, it can help you pay off your debt sooner. Check out our article, Debt Consolidation: Everything you need to know
Check your credit report
Your credit report might just be a piece of paper, but it’s important – especially if you’re applying for finance. The report shows details of credit enquiries, any negative info (defaults and court judgements), as well as positive info (eg. regular payments for loans or credit cards). You can ask for a copy of yours, free of charge, from Centrix, Dun and Bradstreet or Equifax.
Check your credit score
Your credit score is a number between 0 and 1000 that reflects your credit rating. The number is designed to reflect ability to pay bills, or amount of risk to a lender. You can see your credit score for free at www.creditsimple.co.nz
Spring clean your bank statements
When applying for any finance, you will often be asked to provide bank statements. Lenders will be looking for a snapshot of your finances to help determine risk of borrowing. They will look for proof of a stable income and check the likelihood you can afford the repayments. They’ll also look for history of other loan repayments, payday loans and gambling transactions. Any defaults or unarranged overdrafts, gambling and payday loan payments suggest higher risk so will lessen your chances of approval. If you’re planning on applying for finance, it’s best to avoid these for the next few months to improve your chances.