Although the global financial crisis occurred over a decade ago now, the effects of the recession are still being keenly felt by economies and people alike. The situation is nowhere near as bad as it was ten years ago, but wages continue to stagnate, and plenty of people are still struggling to get by.
As such, it is important that your financial life is always in check, and that you do everything you can to navigate this tricky economic period. Here are some considerations regarding taking control of your finances.
Taking out a loan should always be a last resort in any situation, as you will always pay back more than you borrowed. Although interest rates remain low, you should always explore all your options before financing the likes of a new car with a loan.
If you do need a loan, remember that there is plenty of choice regarding lenders, so it is well worth shopping around. The type of loan you choose should also be appropriate to what you will be using it for. If you are a student in need of a short term payday loan, for instance, then a provider specifically aimed at students, such as Smart Pig, might be the better option.
It is also incredibly important to set monthly or weekly expenditure limits to make sure that you are only spending what you need to on essentials. The introduction of budgeting apps like Mint, which syncs with your bank accounts and allows you to set multiple budgets, has made budgeting a much easier process, so such apps may be worth exploring.
With a solid budget in place you can control your spending and get a good idea of how much you need to get by in any given time period.
Given that interest rates are still so low, it doesn’t make much sense to have all your money stagnating in a savings account. Although it may not be for everyone, investing in the likes of stocks and shares (or just about any asset) is likely to deliver much better returns in the long run.
This will not only help you navigate these tough economic times, but also help you to build wealth (especially if you constantly add to your portfolio).
These tips should help you stay afloat in the post-recession world. Once you have an effective system in place to control your finances, you’ll be in good stead for the foreseeable future.