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27 December 2012, 06:00
With the number of people in the North East taking out a pay day loan to pay for Christmas up 20% compared to 2009, Capital's got the advice of a financial advisor and their top tips for 2013 to make sure you end the year in the black.
As the year draws to a close and we all welcome in 2013, lots of people's attention will be drawn to the inevitable New Year's resolution.
Getting fit, a new job, or booking a holiday are always popular choices but more and more people are hoping that 2013 will be the year that they get a little more financial freedom.
Whether it's more money or financial security that people are looking for come the stroke of midnight on the 31st people across the North East will be making personal plans.
For most people the most important aspect of any financial planning is firstly deciding to do something.
When you decide to 'do something' then you take control and everything else, as long as its manageable, should follow!
Be The Tortoise, Not The Hare!
A person's finances are often complicated and the situation, good or bad, is built up over months and years.
Like those people looking to get fit in the New Year it?s not going to happen in overnight so you have to realistic; be the tortoise not the hare!
Make a plan that's going to be manageable so that you're not under undue pressure and so it's steady progress.
There's no such thing as a get rich quick schemes and sorting your finances is the same.
The world of finance is often complicated and we resist any change in our circumstance for fear we?ll fail or it will make life too tough.
If you've decided that 2013 is the year you take control of your money then here are our top 25 money tips for 2013.
Top Money Tips for 2013
1. Never pay retail. Always try to get a discount off every purchase.
2. Don't be financially defensive. Be proactive and take action to better your situation. No one else will do it for you! Don't make excuses!
3. Sell some stuff you don't want or need anymore.
4. If you don't write it down it won't get done. Write down what money comes in and every penny that goes out. Regularly re-evaluate where you are spending your money.
5. Plan in advance. Your options are more flexible while you're not in a crisis.
6. Prioritize. You will have conflicting needs and wants that become hurdles. If you identify your main objectives above all-else, you are less likely to get distracted from your money goals.
7. Take your lunch to work - at least a couple days a week.
8. Before making a purchase, stop. Put it back. Go home. Sleep on it. You'll find that lots of 'needs' fade away and are forgotten.
9. Don't spend your gains (e.g. from investments, saving money, pay rise). Although it's nice to reward yourself sometimes, it's important to use your gains to speed up your path to financial freedom.
10. Work to a situation where debt doesn't pay for daily consumption. Debt can be OK but only when it's used to buy a high price item such as electrical goods, cars, or a property.
11. Little strokes fell great oaks. In other words, a plan is about creating the everyday lifestyle changes that improve your financial well-being over time.
12. Don't get sucked into the 'keeping up with the Jones's' trap. The Jones' will be looking at you with envy once you've paid off your debts and are living comfortably.
13. Take time to build up emergency funds. This way those little emergencies don't result in more debt or derailing your plan.
14. Automate as much as possible. Set up automatic deductions into savings accounts, investment accounts and debts. This way your plan of action becomes automatic.
15. Invest in your financial education and understanding. A little knowledge gained today can multiply your wealth in the future. Talk to an adviser.
16. If it sounds too good to be true it probably is. Don't fall for get rich quick schemes or promises of easy money.
17. Use insurance wisely. Insure the risks you can;t afford to take- especially the risks that would cause financial catastrophe.
18. Pay down debts in the order of interest costs. Credit cards tend to have the higher interest costs.
19. Ensure you use all the benefits your employers offers- your employer may cover things you have been spending personal money on and this benefit may be payable before tax.
20. Go through your bank statement line by line. Understand what you spend money on and cancel any unused memberships (e.g. gym, clubs)
Making financial plans and sticking to them is never easy and sometimes you do need discipline. What will your financial life look like in 2013? That's up to you!