2009 has been one of the most financially challenging years in recent memory. Many families had to make difficult decisions just in order to make ends meet and pay their bills. On the birth of 2010, many individuals made New Year’s resolution that they hope will improve their financial standings throughout this year. Now, we all know that making a resolution is first step but the proof of the cake is in the eating. Some of these resolutions include:
Pay of or Reduce Debt
Many consumers make resolutions to implement strategies that will make a major dent into their debt for 2010. The first strategy is to pay off the credit cards with the highest interest rate. They will attempt to increase their payments from just minimum payments to actually trying to cut into repaying the principal.
Stop Overspending
Many individuals over the years have been tied to their credit card. This has resulted in significant debt as new credit cards were used to clear old ones and the cycle of debt just continued. As a result, a resolution to reduce over spending by spending within the limits of your liquid cash or what is available on one credit card. One commentator suggested freezing your credit card in a bag of water. By the time the ice melts, your mind will be changed about spending.
Stick to the Budget
Establishing a budget for 2010 is very important. After setting a budget, the next stage is sticking to it. When going to the supermarket, make a list instead of walking the isle and just picking up whatever you want and not necessarily what you need. Free budgeting tools are available online that prompt you to enter certain financial information and then produce a budget that should keep you afloat throughout 2010.
Debt Consolidation
Another method is through debt consolidation where consumers can get debt refinancing. Home owners can use their homes as collateral to access these loans that they can then use to clear credit card debt, student loans and any other burdensome loan that have been pressuring them over the years. Under the debt consolidation system, the debt consolidator pays off all outstanding debts and then the borrower is then given one comprehensive loan at reduced interest rate over an extended period. As a result, consumers can improve their liquidity from the availability of more cash in their pockets. In addition, debt consolidation also significantly improves your credit rating as it shows an effort to improve your financial status.
Save More
Saving in a financial crisis is like going to the dentist for extraction. However, I am sure your mothers always offer advice about saving. Many consumers have returned to this advice of their parents where they have decided to save more during 2010. Even if it is 5% of your income, saving something is better than nothing. This saving can be used to establish an emergency fund that must only be accessed to address critical circumstances
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