Hopefully the bad weather days are now over. Spring season is finally here, indicating a fresh start. It’s time to clean up your house and clean up your finances as well. This is especially so if you want to buy a home this year. So how do you do this? Here is what the experts in the industry have to say.
Analyze your credit
When was the last time you fell behind on your payments? Was your loan application ever rejected? All this indicates a poor credit score, so now is the time to amend it. Regular and timely monthly payments can help you with this.
Track your budget
You must have planned a budget for this year, right? Take it out and gauge your performance. What have you been spending money on? Are you overspending or under spending? Whatever it is, you can set it right because you still have most of the year left.
Try to save more
Savings are really important. You should devote 10% of your income towards this, but if you really want to save you can do a lot more than this. Simple things like making use of deductions, paying your bills on time, making your payments before the due date can help you save money in interest and taxes.
Since your biggest debt is probably your mortgage, that is where you should put more focus. A survey claims that a savings of 1% on your rate can help you save over $2,000 a year and that is quite a significant amount.
Reduce your debts
How many debts do you have? Reducing your credit card debt is the easiest. You can choose any strategy you like; target the card with the lowest debt first, transfer your balance or make two payments every month. A financial expert told us that with credit cards, interest is charged on a daily basis. As such, you should pay your balance faster so that you can get rid of the debt in the shortest amount of time.
Get your records in order
Taxes are a pain, but if your finances are in order, they are not much of a problem. Record all your receipts and payment slips and file them in one place. You will need them for deductions at tax time.