Top 6 financial resolutions worth keeping in 2017
If you budget your monthly expenses in a smart way, you can definitely save more, which in turn can also help you pay off your debt sooner, advises Ambareen Musa.
So, 2017 is right around the corner and it's a good time to analyse how this year has fared for you in terms of finances, and if you were able to achieve your financial goals.
If you are about to jot down a new strategy for the next year and plan your financials, why not start with some realistic financial resolutions? The Souqalmal.com team helps you kick start this process for 2017, with the following set of actionable resolutions:
Look for a substitute
Identify how much and on what exactly have you spent in 2016. If it isn't easy to calculate, an estimate would work just fine too. When you look at your monthly expenses in 2016, try to look for categories where you could have possibly saved money. Once these are recognised, try to find a substitute which can help you cut spending. For example, if you are using your car when commuting to work, compare the monthly fuel spend with public transport costs. If it is relatively cheaper to use public transport, then consider making the switch.
Don't overlook petty expenses
You may consider your day to day expenses to be a tiny fraction of your overall monthly spend, but when added up, they may be the cause of a considerable drain on your finances. According to the latest Food & Beverage survey conducted in 2016 by global property advisor CBRE, UAE residents spend an average of Dh68 on eating out per mall visit. If you budget your monthly expenses in a smart way, you can definitely save more, which in turn can also help you pay off your debt sooner.
Save for bigger expenses
If you want to get yourself a new car in the coming year or want to invest in a property, start planning well in advance. Make sure to prepare beforehand and account for your standard expenses such as house rent or your child's school fees, which you're probably paying quarterly, half-yearly or annually. You can also maintain a separate account specifically dedicated to these types of expenses so you don't end up using up the money allocated for them. This way you only keep your remaining disposable income in the current account.
Convert into easy monthly payments
In case you make big purchases on your credit card, consider converting them into easy monthly installments (EMIs). This can help you spread the cost of big purchases over several months. Many retailers have tie ups with various banks which offer EMIs at zero per cent interest rate for tenors ranging from 3-24 months depending on the bank, retailer and product purchased.
Plan your holidays in advance
According to a study conducted by Euromonitor in April 2016, UAE residents spend on average Dh8,174 per year on air tickets, hotel stay and other travel related expenses. If you are sure to travel in the coming year, try to avoid peak months or book everything well in advance to take advantage of lower flight fares and early bird deals. Make sure you do prior research to get the best deals and discounts. If you have a credit card with an air miles program, you can also redeem your miles for air tickets and upgrades.
Clear your debts
If you have accumulated a lot of debt, then you could consider using the 'debt stacking' method to clear your debts faster and more efficiently. This is how debt stacking works; you must arrange all your loans and credit card debt in a descending order based on interest rate. Your priority should be to pay off the debt with the highest interest rate first, and then moving on to the next in that order.
The writer is the founder and CEO of souqalmal.com. Views expressed are her own and do not reflect the newspaper's policy.