As economic uncertainty grows by the day, we all feel the strain on our purse.
Some turn to a simple dream, too good to ignore — winning the national lottery. But ask yourself this: how many people play the lottery? The answer is more than 30 million people And how many winners are there every week? Only six. That’s a lot of losers.
Practicing financial stability isn’t about dreaming big, it’s about living within your means — that’s the harsh reality of the situation.
There are many actions we can take to practice financial stability with more surety.
Here are four of the best:
Cut back on nonessential purchases
What seems like a minimal hit to your account, can soon spiral out of control. Refrain from impulse purchases and take the time to think about whether you really need this item in your life.
Jumping back to the lottery tickets example. Studies show that we spend £15,128.47 chasing the big dream every minute. We are all guilty of testing our luck, but that’s a lot of coins better off in your wallet. Given it is unlikely the numbers will ever fall your way, you will save more by keeping clear.
I recommend that you check your expenses via a banking app. There’s a lot you can learn with the benefit of hindsight. And with online banking, you can retrieve information right away. Make a list of past purchases and ask yourself: is this item worth it? If the answer is no, then strike it from your buying habits.
Stop eating out
We all love eating out — it’s a fun time saver for sure. But not to mention an eye-watering expense on your finances. Regular fine dining experiences are not a sustainable life choice (unless you’ve won the lottery).
Instead, unleash your inner Gordon Ramsey and engage in some great home cooking. Making your own food opens up many financial freedoms. The opportunity to buy ingredients means that you set the budget.
Cooking large meals like lasagna to share is a top savings tip. And don’t turn your nose up to store-brand products. Such items tend to be cheaper, they also often contain fewer additives than branded alternatives.
Don’t fancy yourself as a natural chef? There are many quick recipes for all experience levels so don’t be afraid to give it a go.
Focus on your savings
By living in strange times we lack the benefit of a predictable future. And what’s the one thing the economy hates? Uncertainty. Things can go wrong at any time, so plan for the worst and hope for the best. Investing in the future now may well save you in the long run.
Aim to put away as much as you can afford. No matter how little or large this sum may be, having a cushion to catch you when times are hard is an invaluable asset. Start as early as possible and set aside what you can.
I recommend taking advantage of easy access savings accounts. The interest is variable and can fluctuate over time. But the freedom to immediately access finances allows for a quick response to sudden changes.
Don’t be afraid to get a free overdraft
We’ve all been teetering on the edge of our accounts, terrified of drowning in outgoings. Let me ask you — would you prefer crushing interest rates or a safety net? Sometimes financial stability isn’t about saving money. It is about reducing the severity of your debt.
Not all expenditure is avoidable. Be it rent, mortgage, water or electricity bills; the list of necessities is endless. No matter how hard we try, it’s normal to find ourselves a little overdrawn.
But, many banks charge astronomical fees to enter an overdraft without an agreement.
Before you find yourself overdrawn I recommend enquiring around for an interest-free arrangement. This will give you a small cushion where you pay no extra costs on top of what you borrow.
Recommended reading: Banking in the Time of Coronavirus
Winning the lottery is not on the cards for the majority of us. But we can ensure that our debts remain manageable without a stroke of luck. Practicing financial stability takes a lot of consistent effort. Start by following these 4 steps and you will be well on your way.