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Tuesday, January 18, 2022

Tips to take control of your finances including paying off debts and increasing savings

Money guru Kia Commodore provides loyal followers of her Instagram account, Pennies To Pounds, with useful tips for saving and spending wisely.

Keen to share her knowledge on matters of the bank balance with OK! readers, she tells us her best hacks to help overhaul your finances in 2022…

Tips For Savers

Set up a standing order from your current account into your savings account. You can start as big or as small as you want, however, if you’re struggling to save, I’d suggest starting with £5 a week.

You set the standing order to leave your account on a specific day each week and the money will go straight into your savings account. The beauty of this is you only have to set it up once and the rest is handled for you.



If you’re struggling to save start by putting away a small amount, Kia tells readers

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Make Your Money Last

Create a realistic budget. It is important because it helps you to see where your money is going and what you’re spending it on.

Your budget should contain key areas such as bills, savings, loans and repayments, occasions, “fun money” and everything else in between. The reason why some people find they run out of money is they often underestimate how much they really spend and so don’t allocate themselves enough.

How To Invest

If you’re brand new to investing, steer clear of “hype” investing, which is investing your money into assets based on the “hype” or social media buzz that it has around it. This is fine if you’ve researched and understood what you’re investing in, but doing this as a newbie could lead to you not getting back all of the money you initially put in.

Instead, investment funds are a good first step to look at. These are funds that have a selection of shares from a variety of different companies all in one place. This helps you to spread out the risk you take on your investment and potentially make a return on your money.



There are a couple of methods you can use to get rid of that credit card debt

Pay Off Your Debts

Create a list of all your loans, overdrafts, credit cards and any other debts you want to pay off. Besides each one, detail the balance and the interest rate that is charged on each debt.

You could look to use the ‘debt avalanche’ method, which involves making the minimum payments to all of your debts, but allocating additional money to the loan(s) with the highest interest rate until they’re all paid off.

The other method is the ‘debt snowball’ method where you make the minimum payments to all of your debts, but prioritise your additional money to paying off the smallest first and working your way up.

Save £££ While Spending

Make use of loyalty cards! Loyalty schemes offered by our high-street supermarkets aren’t anything new, but many of them are offering exclusive pricing and discounts by simply becoming a member for free.

Scanning these cards and utilising any coupons given will help to ensure you’re always paying the best price for your shopping. There are also a number of apps and websites that let you make extra cash by scanning and uploading your receipts.



You can use marketplaces to top up your income

Top Up Your Cash Flow

If you’re looking to boost your regular income, online marketplaces are your best friend. We all have items at home we no longer wear or use when they could be rehoused and give you some more money in your pocket. Use your smartphone to take some pictures and upload these items to the marketplaces.

If you also have a skill such as editing, copywriting or even doing voiceovers, you can offer your services on skills websites to work on small projects for additional cash.

The Government introduced a tax break which means since 6 April 2017, the first £1,000 you earn each year ‘trading’ is tax-free, but if you earn more than that you’ll need to declare it to HMRC. See gov.uk/guidance/tax-free-allowances-on-property-and-trading-income#trade for more.

For more money-saving tips, follow @penniestopoundspod on Instagram. For more life-changing tips and tricks, sign up to OK!’s daily newsletter here.

BFIA Admin
The big boss.

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