As 2014 draws to a close, have you made one of your New Year’s Resolutions to get out of debt? If so, then here are some helpful tips to ditch the debt and get into ‘the black’ in 2015.
Consolidate your debt
Do you have a number of debts like credit cards, personal loans and interest-free deals? It’s easy to feel confronted by swelling debts and to simply stop managing them. But this could be costing you thousands of dollars. By far the best strategy for taking control of multiple sources of debt is to consolidate them. This will dramatically simplify monthly repayments and ultimately, allow you to pay off all of your debt more quickly and easily.
Streamline your expenses
If getting out of debt is your priority for 2015 and beyond, then you need to be more disciplined with your spending. Is it possible you’re living beyond your means? If so, look for obvious ways to cut down. Start this process, by looking at all of your spending – here’s a rough checklist to get you going:
• Mortgage repayments or rent
• Personal loan and credit card repayments
• Food: eating out, takeaway and groceries
• Alcohol and cigarettes
• Travel costs – public transport and taxis
• Vehicle costs – registration and insurance
• Utility bills – gas, electricity, water, phones and internet
• Personal products – clothing and toiletries
Increase your income
Another great way to pay down your debts quickly is by increasing your personal income. To do this, you’ll need to build an investment portfolio. This is a great way to get out of debt, build your personal wealth and achieve financial freedom. Here are three types of investments that should be in your portfolio:
As the cornerstone of any investment portfolio, buying stocks or shares in publically listed companies can grow small, initial sums of money into healthy financial returns. Trading on the stock market (or equity market) is not without its risks though, so make sure you do your research and watch the market religiously.
If playing the stock market sounds a bit daunting, managed funds are a great alternative. Fund managers do all the hard work for you and provide ‘balanced’, ‘growth’ or ‘conservative’ funds. This allows you to choose what level of risk you are willing to take based on the type of return you are seeking.
Most of us know about the stock market, but have you ever heard of the currency or foreign exchange market? Also known as ‘Forex’ or ‘FX’, this is the largest market in the world. While the main players are international banks, individuals can also trade. While the returns can be high, so can the risks. Therefore, make sure you skill-up before you start and get some advice and tips from experts such as Knowledge to Action . Top traders can give you simple strategies to minimise your risks while maximising your profit.
The concept of ‘wealth’ isn’t about driving flashy cars and having the best of everything. Instead, it’s about having the financial freedom to live well, pursue our dreams and to fund a comfortable, well-earned retirement. To grow your income and wealth, select a range of investments, get some expert advice and tailor your portfolio to suit your financial needs, situation and goals.