Financial Literacy Month – Top 10 Financial Tips To Empower You | GEM Debt Law
November is Financial Literacy Month marked by the Financial Consumer Agency of Canada. Throughout this month, FCAC shares financial literacy to Canadian families, individuals, and businesses, to help strengthen the ability to manage money and debt wisely.
To take part in Financial Literacy Month, our debt experts are going to share the top 10 financial tips to help you in your everyday life.
1. Set Financial Goals
Being serious with your financial goals will help you determine what you want to accomplish with your money. How much debt you can pay and by when. Lastly, how much money you want to save, can, and by when.
2. Is it a need or a want
Identifying whether you want or need to make a purchase can sometimes be challenging. Before any purchase ask yourself if you need it or if you can live without it. For example, you have 40 pairs of shoes that are probably sitting in the closet, do you need an extra one just because you like it? If you focus too much on satisfying your wants, you might not be able to do so with your actual needs.
3. Pay Your Credit Card Statement
Credit Cards are a proven way to improve your credit score. Making your monthly payments in full, will show lenders that you’re good with your finances in case you need it in the future.
4. Figure Out Your Debt
Write down all your debt. It can be scary to have $40,000 in debt and only $1 500 in your bank account. Doing so, you’ll get motivated to start saving.
Also, keep in mind the interest rates for each of your loans. This will help you determine which loan to pay down first depending on how high the interest is.
5. Automate Your Process
Once your finances are in place and your debt is all paid off, you can now focus on your savings goal. You can automate that every paycheque, a certain amount will automatically go towards your savings account.
6. Stay Away From Co-Signing Loans
Before jumping into signing the papers for your friend or family member, think about – if the bank doesn’t trust them for making the payments, can you? If they miss the payments, your credit score takes a hit and will affect you as well. Not only the relationship between you two will be damaged, but your finances also.
7. Pay Yourself First
If you’re not on top of your finances, chances are that you’re not going to achieve a healthy savings or investment account. Before paying your bills, entertainment, or groceries, take 5% of your salary and put that towards your savings. The best way to not miss doing this is to automate the process. You don’t see it, you won’t be able to spend that money.
8. Maximize Your Employee Benefits
Employee benefits such as medical and dental insurance, health savings, and paid vacation are worth a good amount of money. Make sure you take advantage of those.
9. Evaluate Your Purchases By Cost Per Use
It may help your pocket to avoid buying the latest gadgets or the cheaper versions of them. Think about how many times you’re going to use that product or if you need a new one instead. For example, the latest kitchen robots, clothes, or shoes.
10. Focus On Yourself. Not Others
It’s popular nowadays that we focus more than we should on what others have and we forget about our own progress. We all possess different situations and not everything goes the same for everyone. If you have more questions about your finances and what you can do to become better at it, reach out to our debt specialists today through our contact form.
For more information about Financial Literacy Month, check out the Government of Canada website here.