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If you’re on a tight budget, it’s imperative that you manage your money effectively. Spending extra on unnecessary items is no longer an option if you want to be able to pay your bills. You might find that you’re spending lots of money on shopping without even realising it. Finding a way to manage your money will pinpoint any areas in which you might be going wrong.

Start a Budget

First of all, you need an actual budget! That means taking the time to sit down and actually write one. There’s no excuses here, you can even get apps on your phone that’ll help you. You can either go back over your previous bills or start keeping track of what you spend for one month from today. Analyse how much you’re spending and what you’re spending it on. Then, look at how much you make each month and compare the difference. Is there an area you could cut back on? Are you going out and spending money too often? Analyse and create a solution.

Check Your Bills

You also need to look at your bills and see how much you’re paying. Are you still paying full price for Sky TV even though you’ve had it for five years? Did you know that you could halve that bill, simply by calling them up and renegotiating? We have a tendency to fall into bad habits when it comes to bills. We hate dealing with them, so we leave them be and accept whatever we’re told. Look at heating and electricity bills and what you’re spending. If it’s too much, try cutting down on heating as much as possible, or stop using five different technology devices at once. There are lots of ways to cut those bills down.

Compare Products

Managing your money doesn’t have to mean neglecting your health or even buying new items! From time to time, you’re going to need to buy products for yourself. Don’t go overboard and buy that nice pair of new shoes that you’re idling in the window. However, if you need a new printer or set of office equipment to get your work done, buy it. Don’t waste money on the cheapest option that’ll go faulty within a week. Instead, look at product comparison websites for something that’s reliable. The key to budgeting is to remember that needs like this will crop up. Set aside a certain amount of money every month to account for this.

Use Coupons

Another way to shop effectively is to use coupons. You’ll find these on websites like http://www.coupons.com/, as well as newspapers and magazines. Gather some of these together and bring them with you next time you go shopping. These coupons might only offer a small amount off of the overall price, but they add up over time. Suddenly, you might find that you’ve saved a lot of extra cash over the course of a month. Of course, always look for the best price for any item you desire. Don’t just accept the first price you come across.

Avoid New Credit Cards

If you can help it, stay away from credit cards. Although it’s tempting to pick one up when you’re in dire straits, it can be a path to a dark place. Depending on how well you manage your money, it’s easy overspend with these cards. Debit cards are much easier to manage and won’t allow you to go over your limit. Even if you think you’d be fine with a credit card, I urge you to stay away as much as possible. You don’t want to be getting into massive amounts of debt.

Avoid New Loans

Something else that I advise you avoid is loans. However, there are circumstances where you need a loan to pay for something particularly important. Home loans are one thing, but personal loans can get very risky if you don’t know what you’re doing. If you absolutely have to take one, make sure you keep an eye out for the APR. This represents the interest rate that you’ll be paying. Sometimes, this figure is astronomical, particularly if you’ve got a poor credit rating. You must read the small print before you enter into any agreement as the consequences could be devastating.

So, there are lots of things to think about when it comes to managing your money. This is why it’s so crucial to have a plan of action and a budget written down. With the right amount of self-discipline, you should see an improvement over time. Keep working at it, and you’ll be financially healthy in no time. You might even be able to go on holiday with the extra money!