It can nevertheless be tough to see the way that the money you bring in is quickly depleted by all those essential monthly outgoings. The amount you bring in looks nice, but then every direct debit and outgoing payments chips chunks of it away - to the point where the average American family is left with relatively little in terms of disposable income, as theatlantic.com reports.
So what can you do about it? Controlling your monthly outgoings is a vital part of the financial planning process, so take a few steps in the right direction and you could be left with more money at the end of the month.
You might know about your outgoings, but that doesn’t mean you have seen them all collated into a single list before. When you see the full list of all the regular payments you make, you might be surprised by how long it is. Ensure you include payments that you make via a card -- such as a Netflix subscription -- as well as the direct debits from your bank account.
Step Two: Look At Debt Repayments
The first area you should focus on is debt repayments. These are movable figures, meaning you can change them -- it’s not like the rent or mortgage, which you aren’t going to be able to do much about. If you have savings, then it’s worth considering debt consolidation; if you don’t have savings, it might be more beneficial to take out a single loan and reduce all outgoing payments to one smaller payment. There’s plenty of advice on how this might work on debtconsolidation.co, so have a read, and you could soon see your monthly outgoings tumble.
Step Three: Check Your Insurance Policies
Insurance policies are great, covering you in the event of the worst happening. However, they can also be troublesome -- especially if you have policies running for items that you no longer need. You might even find that you have duplicate policies covering the same thing. So it’s important to take the time to go through each and every policy, ensuring that you cancel those that are no longer relevant to your financial needs.
Step Four: Practice A One In/One Out Tactic
If your primary focus is on saving money, then the simplest way of managing monthly outgoings is with a one in/one out policy. Every time you subscribe to a new monthly payment -- be it a direct debit or a payment to a subscription service -- you have to cancel an existing payment. This means you will focus on what you actually need and see as important, ensuring every dime you spend is going to services that will actually benefit you.
By the end of going through these steps, you should have significantly reduced your monthly payments -- giving you and your family more financial freedom.