family financesIs your money a bit all over the place? If so, chances are it’s not all being used to its best potential. Getting organized and making an effort to properly sort your finances will mean you end up in a much more comfortable position financially. Here are a few ways to go about it.

Get your debt under control

When it comes to sorting out your finances, getting debt under control should be the very first thing on your list. Being in debt is both stressful and expensive, so it’s important to do what you can to get it to a manageable level.

In some cases, selling items you don’t need, tightening the belt on luxuries and picking up extra shifts at work for a few months can be enough to pay down balances. But if things are out of control, you still have options.

Speak to a debt management company or a charity who can give you advice based on what you owe and what you earn. They can give you IVA help or advice on bankruptcy, or you might be able to start an informal debt management plan.

Here the interest on all of your debts is reduced or frozen, and your payments are reduced so they’re at a manageable level. This enables you to regain control of your debt and pay it off without getting further and further into trouble.

Start saving

It makes no sense to save money while you’re in debt, because of the interest you’ll be charging it makes sense to put any extra cash you have towards that.

But once all of your accounts are paid and closed, you’re in position to start putting money away. Open two new accounts, one for your ‘rainy day’ fund- emergency savings that are only ever touched in a genuine emergency and a buffer for unexpected expenses. The other for regular savings – a new car, a holiday or whatever you want to save for.

Create additional sources of income

Give yourself more financial security by creating additional streams of income. Even if your regular job seems pretty secure, no one knows if the company will go bust, or if they’ll get unwell and not be able to work or any series of events leading up to a job loss.

So having other ways to earn money not only helps you to save faster and give you more cash in the here and now, but if you lose your regular job then you have other options to fall back onto. Blogging, freelancing, tutoring and home businesses are all ideas of ways you can earn extra cash in your spare time.

If you have money to spend, you could make investments which would earn you money without any hassle or time needing to be put in by you.

Claim all of the money you’re entitled to

If you’re on a low income, depending on where you live you might be entitled to help from the government. Don’t be too proud to accept it, it’s money you’re entitled to so make sure you’re claiming what you can get.

Search for a phone number or online help in the country you live in and run some checks.

For example, in the UK all families with children are eligible for child benefit, when you’re on a family budget even a small amount each week can make a difference.

Take out the right insurances

Insurances can protect you from financial harm, if the worst happens then ensure you’re not left out of pocket. If you own your home then buildings insurance is a must, and everyone should have contents insurance to protect the things that they own from theft and/ or damage.

You can even take out specific appliance or boiler insurance, as well as things like pet insurance. Consider what you might need in an emergency and consider taking out some policies.

Stick to your budget

Everyone needs a budget, and when you’re a family sticking to a budget is absolutely essential. Most of us (unless you’re incredibly wealthy!) are in a position where we have plenty we need to spend but limited income.

Work out what your outgoings are, set all of your bills to come out of a separate account by direct debit. That way, each time you get paid you can transfer a set amount to cover them- they’re always paid and you never accidentally spend back into the money as it’s in a completely separate bank account.

Work out how much things like groceries should cost based on what you can afford, if you need to spend less then there are lots of ways to cut costs. Buy cheaper brands, shop to a list and meal plan to avoid buying too much (and it going to waste).

Go online and find cheap yet healthy and tasty recipes– pasta for example costs next to nothing and can easily be bulked out with whatever meat and sauce is on offer. You don’t have to starve or start rationing supplies, a few simple changes to your shopping habits might be all that’s needed.

Snag the best deals

Why pay full price if you don’t’ have to? The internet makes it so easy to compare prices, from price comparison sites to find the best deals on bills, to doing a quick Google search before buying a product.

If you shop online, make a habit of going through cashback sites since you get a little back each time you buy and at the end of the year you could withdraw it and put it towards Christmas.

It takes very little time and effort to find the best prices but could save you significantly.