With everyone getting in a panic about the credit crunch, the rising cost of living, and imminent global economic disaster, it seems ever more important to make your salary stretch as far as possible. When nearly everyone will one day be earning a regular wage, it seems truly astonishing that schools do not teach such a useful skill as budgeting, and that many parents fail to instil a sense of frugality in their children. But worry not, it’s never too late to learn a new skill, and here are some tips on how to manage your salary wisely.

The first step – and yes, this may be boring, but it’s necessary – is to sit down and work out your income and outgoings. If the latter is greater than the former, you’re in trouble, and it’s time to take control before things get any worse. If you don’t spend more than you earn, it’s still worth taking a look at how you can make better use of your money, as there are always ways of making cutbacks. Even if you have plenty of disposable income, why throw it away? It’s far better to save as much as you can, and use it for something worthwhile, or leave it earning you lots of lovely interest (okay, maybe not that much interest, but it’s better than nothing, or worse, spending everything).

Most people know how much their take home pay will be every month, which makes it easier to budget. Having worked out how much your outgoings are, you can then look at where they can be reduced. Grit your teeth, and spend an evening looking at ways of reducing your expenses. Some things can’t be cut out altogether, unless you want to live by candlelight and cook on a butane store, but they can be reduced. Look at how you can reduce your energy consumption, by keeping the thermostat down and switching off lights, for example, and research cheaper energy providers. Try car-sharing, or cycling to work, if possible.

Now look at non-essentials. This is the easiest way to make savings, even if the prospect of a more frugal lifestyle fills you with dread. Try going out less, cooking budget meals for friends instead of eating in restaurants, waiting for a film to come out on DVD rather than going to the cinema, and buying clothes in the sale. Set realistic budgets for everything, that means not denying yourself any fun, while acknowledging that you don’t have unlimited funds. Buy clothes in the sales and plan your wardrobe. Avoid impulse purchases, and think about whether you really need something. Change your mobile phone plan, and use your landline wherever possible. Keep your credit card for emergencies. Follow this advice, and more of your income will stay in your bank account!

Every newspaper and every news reports tells us we are in the grip of the start of a recession, but for many of us we do not need the media to tell us about the recession many of us are living with it from day to day. This year has seen a large increase in home repossessions,  those looking for debt management help and advice and even an increase in the number of people being declared or filing for bankruptcy.

Many household consumables have increased in priced over the last 6 months, most of us are struggling with increased utility costs and as the winter draws in, many people have to choose whether to eat or heat their homes. So how do we manage, is it possible to cut back on unnecessary spending and try to make savings? The answer is yes, there are steps we can all take to spend less and even save some money.

How do we cut down on unnecessary spending and make savings? The key to this is honesty and budgeting. We need to look at our household expenses and spending, identify the essential items and reduce the extras. When we have identified what we spend our money on we can take steps to reduce our spending, we need to agree our budget and look for the best deals. Perhaps we need to look at simple things like our mobile phone contract, or our broadband/telephone package and look for better deals. Perhaps we need to remove some non-essential luxuries such as satellite television packages or even buying non-branded goods when we do our shopping.

We have to be totally honest about our spending, if we hide things we are only bluffing ourselves and this will not help us make savings. There are lots of competitive deals around on things such as insurance, so we have to make sure we are getting the best possible deal. Where possible we should also use cash back sites to make our purchases, making sure we earn something from the essentials that we need to buy. We should all be trying to reduce our carbon footprint to save the planet, but this may also help us to economise on our food and heating bills, if we use less we will spend less.

Because the current economic climate is so gloomy we need to be actively reducing our current debt, this will enable us to make greater savings when the economy perks up.

Debt is a serious issue, and has serious consequences. If you are in debt it is important to look for debt help.

Although it can be hard to come to terms with the fact that you are in financial difficulty, once you do this you are opening yourself up to a lot of resources that can help you get back on the straight and narrow.

There are many companies that offer credit cards or loans to assist you with eliminating your debt, but rather than commit yourself to further borrowing it is better to speak to somebody about your options. There are confidential debt lines with trained staff that work with you to look at your options, their aim is to help you be debt free, and so who better to speak to? By talking to these people you will become more informed about what you can do and begin to relieve some of the stress related to being in debt.
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Get debt help. It is so easy to get into debt, but not as easy to get out of it.

The first thing you need to do to get debt free is set a realistic household budget. List all things you have to spend money on i.e Gas - Electric, mortgage, then list all the things you want to spend money on. The goal is to separate between ‘Need’ and ‘Want’ for example you ‘need’ to eat or you ‘want’ that new cd.

The idea is to look at you outgoings and see where you can make cut backs, set yourself a shopping budget for food. Some examples of how to save money on groceries, household bills.

1. Ask your supermarket what time they mark down there products, and purchase these when they are cheaper. Most things can be frozen to restore the sell by date.

2. Grow your own vegetables and fruit alot cheaper than buying.

3. Use price comparisions sites to check you are not paying to much for your gas - electric or mortgage.

4. Check with your enegry supplier to see if you have an economy setting, do you washing etc in the evening as it is cheaper.

5. Take a shower instead of a bath, its cheaper.

6. Do you really need the heating on ? Can you just put on another layer of clothing.

7. Hang clothes to dry on a rainy day indoors over the bath or use a clothes airer, its cheaper than the tumble dryer or radiators.

8. Use natural products for cleaning its cheaper and better for your health !! I.e Vinegar for cleaning windows.

Overall just think about ways to do things on the cheap, research and you will be saving money and getting out of debt.

Remember pennies make pounds and pounds make rich men !!!

In addition to the standard ‘write and stick to budget’ there are a number of further ways to help you stay out of debt. One of the most effective ways is to carefully think about whether you actually need to make a purchase - don’t just buy something because it’s on sale, on offer or because you’ve fallen madly in love with it at first sight. If after a lot of careful deliberation you realise that you do need it - then if you don’t have the money, save up for it. Remember that by paying for anything with borrowed money, you’ll end up paying a lot more than the price tag once you add on all that interest.

Another great way to stop impulse purchases causing debt is to freeze your credit cards - Seal them carefully in a freezer bag, and then put this bag into some water to freeze. Your cards will still be there when you need them - but the time taken for them to thaw out gives you thinking time about whether you really need to use them.

If you can afford it put a small amount of money away each week or each month. No matter how small, eventually this will mount up to a nice little pot to help cover any rainy day emergencies. Make sure that this money is put in a high interest savings account - and put the first £3000 in a cash ISA to avoid paying tax on your savings.

So you have a household budget that you stick to but you’re still worried about falling into debt? Well that is understandable, all it takes is for the boiler to pack in, or unforeseen circumstances to pop up causing necessary expenditure of cash you don’t have.

The first way to buffer against this is to save regularly and have a savings pot for when things go wrong. At least part of the saving should be instant access for when money is needed urgently, as I found out when my cooker died! Being debt free doesn’t have to mean no credit cards.

Many credit card offer a percentage cash back for using them and as long as the balance is paid off in full every money this will save you money rather than charging you interest.

Don’t forget those insurances you pay every month either, if you drop the iron on the carpet (as i did in december) then you can probably claim it off the house insurance if you have accidental cover.

Debt. We live in a world where it is easy to fall in to debt. Some debts are unavoidable & I think that it is important to manage the debt you have so that it does not cost you more that it absolutely has to. Its also important to have a goal of being debt free & not borrowing unless it is 100% necessary.

Mortgage
Our mortgage is the biggest loan any of us will be personally asking the nice bank manager for.
I think that 100% mortgages are a bad idea as they give you 0% equity in your property for the first several years. Also, if there is any down turn in the market you could find yourself in a negative equity situation. This means that if you sell your house, the amount realized from the sale would not cover the amount you owe. No one wants to have to pay for a house that they no longer live in.
Many people pay a little extra off their mortgage every month. This is a great idea as it reduces both the amount of the original debt & the interest that you are charged. You are also reducing the term of your mortgage.
I think that it is important for people to take the time & look for the best mortgage deal that they can get. Its now easy enough to change your mortgage provider & can often make a considerable difference to your interest rate.

Credit Cards / Store Cards
Unless you can afford to fully repay the amount owed every month I think that cards are the easiest way to end up in debt. The interest rates are high & it is far too easy to charge items to the card either online or in shops, restaurants, bars etc.
If you find yourself with large card debts cancel your cards & transfer your balance to a new card. There are lots of 0% interest for the first x months offers. This will give you breathing space to reduce the debt without the interest charges.

Holiday / Car / Wedding Loans
The golden rule should be that if you cant afford to pay for it outright then you cant afford it.
Lenders are giving out loans far too easily. There is nothing wrong with saving for a few months in a high interest account & then buying your car or going on your holiday. Most people are surprised at how quickly it adds up & once you are in the habit of saving it become easier.

In today’s society debt is an issue for many people. Almost everyone knows someone who has been affected by debt. One major way to avoid getting into debt is to plan ahead, not just by creating a budget and sticking to it, but also by saving.

Saving money is a very similar principle to setting a budget. Firstly you need to look at how frequently you are paid. If you are paid monthly then you set yourself a monthly savings target, if weekly then a weekly savings target should be set. Generally you should aim to save at least 10% of what you bring home in your pay-packet after tax, national insurance etc. So if, for example you earn £1,200, then you should aim to put £120 of that into a savings account. However, if your on a really tight budget save as much as you can afford to, even 1% is better than nothing.

It is very important to keep your savings in a separate account to your normal everyday spending account, otherwise you risk unwittingly spending your savings. It is also extremely important that you make your savings work for you - you want to get as much benefit from your savings as possible, so a high interest account such as an ISA is advisable. Once you have put your savings into your chosen account forget about them, they are not extra money for you to use on frivolous things, they are there as a back up plan, to stop you getting into debt if a cash-crisis emerges such as the temporary loss of income or your roof collapses.

Dedicating the time to sorting out your finances and planning a savings-budget is one of the most important investments that you can make. Making a small commitment to save just 10% of your pay, an amount which many of us would not miss, could really make the difference between being financially secure and getting into debt.