Money Mondays is your go-to guide for all the information you need to manage your finances. For this week’s Independent Woman’s Bank Account column, we look at five easy things you can do for your money today.
Whatever your relationship with money, it’s always good to do a quick check-up on your finances.
But where should you begin?
Here, financial expert Emilie Bellet pinpoints five things you can do today to help boost your financial standing, from checking your credit score to considering your pension. A former banker who worked in private equity, Bellet is the founder of Vestpod, the first weekly newsletter to talk personal finances with women.
Scroll down to get started on your own financial check-up now…
Check your credit score and start repaying your credit card debt
Your credit score is key to determining how much money you can borrow. Everything from setting up a credit card, to taking out a business loan or mortgage, requires lenders to reference the often dreaded credit score.
It plays a key role in helping them decide how much you can borrow and how much interest you will pay. The better your credit score, the better your chances at getting a good deal will be. You can use sites such as Noddle and Experian to check it out.
If you’re blushing at the memory of that one credit card bill you didn’t pay off on time (we’re not judging, promise) then don’t worry. There are simple ways to give your credit score a much-needed boost.
First, find out what your exact credit score is. Second, please don’t forget to pay your bills on time (that includes credit card bills - no cheating!) And finally - keep using that credit card (or go out and get one). The more payment history you have, the easier it is for credit agencies to process your application. So don’t give them a reason to dig up any dirt - make sure you pay off those bills.
Prepare a budget
We all see budgeting as extremely boring, but it’s a great place to start. Are you aware of what you are spending?
The 50/20/30 budgeting guideline was first introduced by the Harvard bankruptcy expert Elizabeth Warren - one of TIME’s 100 Most Influential People in the World - and her daughter, Amelia Warren Tyagi, with whom she coined the popular term.
The 50/20/30 guideline means that 50% of your income is allocated to essential expenses, 20% to financial goals and the remaining 30% to lifestyle and flexible spending.
You can read more about streamlining your budget using the guideline here.
Calculate your net worth
How many of you get a regular check-up at the doctor’s? Are you as diligent when it comes to checking up on your financial health…? Most of us aren’t.
Financial planners insist that one of the best indicators of financial well-being is personal net-worth. But what exactly is it, and how is it calculated?
An individual’s net-worth is a snapshot into their financial state of affairs - their net economic position. It normally refers to assets owned minus debt owed. Over time, your net-worth will change as your assets and liabilities fluctuate (this includes everything from earning interest to repaying debts). Monitoring your net-worth is a simple, necessary step towards greater financial independence, so no excuses. Go and start calculating yours today.
Look into your retirement savings
A pension is simply a tax free way to save money for later life. You, your employer and/or the government pay a sum into the pot every month.
That money is deducted from your salary, so although you’ll be earning less now, you’ll have more money than you started with later, when you might need it more. When you retire you can either cash it all in or take it as a monthly income (called an annuity) for the rest of your days.
Be sure to check how much you are contributing, how it is invested and how much you are paying in fees. You can find out more information here.
Register with Vestpod.com
The site will provide you with a free weekly newsletter as well as workshops and a finance book club.
Illustration: Samad Jble
Other images: Getty, Pexels