It’s crucial to maintain a household budget
The post-pandemic continues to affect many households. People are considering where they reside and how they live, reassessing retirement timelines, and assessing future personal goals in the face of the new variants.
Several federal financial programs have come to an end, and employment opportunities have varied from one sector to another.
As consumers start the new year, having stable financial footing may become a necessary goal to meet day-to-day needs.
The Better Business Bureau of Greater Houston and South Texas offers the following tips to help you get on the right track to a better financial future:
• Calculate your income. You can’t properly set a financial resolution unless you know how much income you have. Calculate your monthly net (after tax) income, so you can set a clear budget with exactly what you are bringing home.
• Set up a budget. Once you have an idea where you are spending money, you can set up a realistic budget. There are free online tools to help you, so there is no need to spend a lot of money on budgeting software.
Be cautious of scams, however, being mindful not to share personally identifying information unless you have verified the site’s legitimacy.
• Monitor your spending. Whether you prefer an app, computer software or a notebook to jot down your expenses, keeping track of which categories you are spending money (home goods, utilities, entertainment, etc.) is critical, allowing you see where you are actually spending your money rather than where you think it’s being spent.
• Pay down debt. One method is to pay off the credit amount or loan with highest interest rate first (the “ladder method”). Another is to pay off the smallest balance first, so you feel a greater sense of accomplishment (the “snowball method”). Use whichever method works best for you. The important thing is that you are doing it.
• Be proactive with your finances. Avoid wasting money on unethical businesses or scams. When making a purchase or choosing a business, check with the BBB.
Making careful decisions now can save time, money, and headaches later. Remember, great businesses are out there. Start with companies you can trust by visiting BBBHouston.org, and check BBB Scam Tracker reports regularly to see what scams are happening in your area.
• Build an emergency fund. Ideally, an emergency fund can cover things like home repair, unexpected medical expenses, or layoffs. Financial experts suggest an emergency fund of three to six months of living expenses.
• Keep track of your credit score. Credit scores are used by lenders to make decisions about whether or not to offer you credit and what those terms (interest or down payment) will be.
Your credit score is a decision-making tool that lenders use to help them anticipate how likely you are to repay your loan on time. Landlords also use your credit score in their decision making.
Visit www.bbbhouston.org or call 713868-9500. Leah Napoliello is BBB VP of operations. Send questions to Leah Napoliello, Better Business Bureau, 1333 West Loop South, Suite 1200, Houston, TX 77027, or e-mail lnapoliello@bbbhou.org with address and phone number.