Cash clean out
Easy ways to keep your bank balance healthy
Keeping your finances in working order doesn’t have to be a huge hassle. We got financial planner Greg Smith on the case to flush out and slay our most common cash-sucking demons.
Money Demon: “I’ll open those statements later”
No, do it now! Don’t put off money stuff just because it seems boring. Consistently late payments may give you a black mark on your credit file – even for small amounts– which can prevent you from getting a mortgage or personal loan. Go to www.mycreditfile.com.au and request a copy of your file (for $27). To learn to handle your money better, go to www.understandingmoney.gov.au. This new Federal Government website will show you easy-to-grasp money tricks that can make a real difference to your finances.
Money Demon: “I can’t be bothered to shop around”
Rather than blindly accepting what you pay for your phone and credit card, do yourself a favour and visit sites such as www.phonechoice.com.au and www.infochoice.com.au. You’ll find the sneakiest tips and tricks for the best-value phones, credit cards and personal loans. (Did you know you might qualify for a “relationship discount”? That’s if you have several accounts with one bank.) Getting the inside scoop saves you heaps.
Money Demon: “I just can’t stop spending”
An effective way to curb impulse buying is to do a quick mental calculation that divides the price of the item by your hourly wage. Lisa, 25, has a mobile already, but is desperate for a $1150 handset. “I earn about $25 an hour which means I’ll have to work 46 hours, or nearly six days straight. That’s six days of not eating or paying rent or having fun. Just for a phone! I could live without it…”
Money Demon: “I’m too shy to negotiate”
Just because there’s a price tag doesn’t mean it’s fixed in stone. Whether it’s a pair of jeans, a new fridge or even a lower rate on your credit card, we too often pay full price without question. If, for instance, you want to buy the last item in the shop, they may be glad to get rid of it and accept an offer. With a credit card, call and say that you are about to switch to another. Tell them you may reconsider if they can offer you a better rate. Hey, if you don’t ask, you don’t get!
Money Demon: “Who’d want to steal my identity?”
It sounds unlikely, but anyone can rummage through your wheelie bin or send you emails, pretending to be your bank. A would-be fraudster only needs a few select personal details, and they’re on their way to accessing your life. Each year, more than $6 billion dollars is lost to ID fraud in Australia. So, always file your bank statements and destroy documents that contain personal info. Oh, and don’t respond to any email requesting your banking password. Duh.