Consolidating your Finances

As a nation, we’re getting more and more in debt each year, and some of these debts can come with hefty interest rates and fees. So it is easy to see how our finances can quickly and easily spiral out of control. I’m not a financial expert but I wanted to just put a few ideas out there to anyone who struggles with debts and would like to take some control back.

How Do You Take Control?

Well, you start off by doing your research, it shouldn’t take too long but it will give you a better picture of where you stand. Even if it looks awful once you see it all on paper, don’t panic, you knew it wasn’t great and you are making positive steps to change it. So,

Number one, do a thorough income and outgoings list. These lists need to include EVERYTHING there is no point in conning yourself into thinking you have more that you do, it will set you up to fail.

Number two, check your credit score. Your credit report will provide you with a score. The score gives you an indication of how your finances compare to others in your areas and of how financial organisations may categorise you if they were to do a search for you. It also provides you with a list of all the financial organisations you are connected to, who you have debts with, what your defaults look like and your total amount of outstanding debt.

Now you know where you stand, you can start the improvements.

Creating Your Own Plan.

Now you have had site of your financial position as a whole, make use of your free credit report by using it to assess what action to take first. If you want to increase your credit score slightly then making simple changes like ensuring you are on the electoral roll, contacting companies and closing old accounts and disputing any discrepancies on your report can all help boost your score. However, if you really need to put a consolidation plan in place here’s some tips on where to start:

Balance transfer credit cards: If you are racking up more debt, not by spending but by accruing a load of interest and you have a good credit rating, it might be a good idea to consider a 0% balance transfer credit card. This will allow you to consolidate your credit card debts onto one credit card of which you will pay 0% interest for a fixed period of time. Two things to be very careful of here, one is that you must remember to ensure you switch to another 0% card prior to the end of the fixed period (if the debt is not already paid off) and two is that in order for it to work as debt consolidation and actually minimise your debts, you have to keep paying the full amounts off. If you get tempted to make minimal reduced monthly payments all you will be doing is extending the length of time you have your debt.

Mortgages: For most people a mortgage will be the largest most imposing debt they will ever have but because it is a long term debt, quite often we just allow the banks to make changes to the terms of the agreements, shift our mortgages and we allow ourselves to leave it sat there in the background unaware of how much interest is being accrued. How much of our hard earned cash is really being paid into buying our home and how much is going on interest? If you don’t already know, now is the time to check and then shop around, you never know, it might be time to move from our ‘trusty’ local bank to one that can offer us a much better deal and ultimately make quite a dint in one of our biggest debts!

Low interest loans: If you have credit cards appearing on your credit report it’s important that you find out the interest rate being charged if you do not already know. The company contact details will likely be on your report if you don’t already have them, so you can always call to check if you don’t have all your original documentation. If you find that the credit cards have particularly high interest rates, it may be worth looking into getting a low interest loan to consolidate the amount of debt racked up on the cards as loans have a set payment plan it’ll also be much easier to manage than your cards.

To consolidate expensive credit cards

Talk to the companies: Armed with your income and expenditure call the debt collection companies. Ask them about making minimum payments and ask them their advice on any further deals they may be able to offer you. Occasionally and especially for long standing debt, collection agencies will take a slight hit on the amount of return from you by accepting a full and final settlement, it won’t always be on offer and you have to be careful about the detrimental effect on your credit rating but it is worth asking those chasing the debts for potential options for settlement, you might be surprised at how helpful they will be if they think they can wipe your debts from their books sooner rather than later.

Not Comfortable Going It Alone?

If you are considering using a debt management company then do your research first, make sure they are reputable, make sure you have a good idea of the consequences (ie effect on your credit rating) of any plans they suggest, and make sure you have a good understanding of the fees the company will charge. The clip below will start you off thinking about how debt management companies work so you can expand your research to make sure it is the correct choice for you.


How to Ask for a Pay Rise

Is your salary leaving you with little disposable income and a quality life that doesn’t quite live up to your expectations? Is it forcing you to start shopping around for another job? Well, before you jump ship ask yourself a few questions: Do you enjoy your job? Are you good at your job? Does your job provide you with opportunities you are happy with? Would you be unhappy about leaving? If the answer to these questions is Yes, then perhaps there is another way…perhaps it is time to ask for that pay rise. If the thought of a confrontation and actually asking for a little bit more salary has just filled you with immediate dread, then these tips might help you feel a little bit more confident and ultimately lead to a successful salary negotiation.

Tip 1 – Do Your Research:

There are two main pieces of research you need to do before you ask for a pay rise. Firstly, research your role in other companies, especially direct competitors. It is pointless asking for a pay rise if you are already sitting on a salary way above others in similar roles to yourself, if you are on a lower salary than others in your area of expertise than it will give you a ball park figure to help you decide what amount of money to ask for and if you go into your negotiation with this information available then it will show that you have done your research and are being reasonable in your request.

The second piece of research that you should complete is on yourself. Have a look at the past year or so of your career. Have you; got an example of outstanding performance, gone above and beyond, taken on new responsibilities, had an exemplary sickness record or got involved with projects outside of your job role whist maintaining great standards of work or regularly worked overtime? Make a note of anything similar to this and use it to sell yourself. You need to show them that you are an asset that should be valued and rewarded appropriately with that pay rise!

If you face the negotiation armed with facts and reasoning it will be easier for your boss to understand your request and perspective, allowing them to come to a quicker and easier decision.

Tip 2 – Ensure your Timing is Right:

Don’t start off on the wrong foot by bombarding your boss unexpectedly whilst either they are busy or you should be. If you have regular ‘catch ups’ or one to ones this would be a great time to ask them if they would be able to arrange a meeting with you about your salary. Alternatively, if they are difficult to catch, pop them an email asking them. They will appreciate the warning and not being caught off guard and it might give them some time to do their research too which might just work in your favour.

Tip 3 – Stay Calm and Avoid Confrontation:

Nobody like confrontation so if you attend your meeting with the research you previously carried out as notes, it should help you not to get flustered. Stick to why you deserve the pay rise, why you are an asset to the company and your passion for the role/company you are in rather than why you need the money. As always, it’s important to remain professional so if you bear these things in mind you should be able to approach the meeting as you would any other. Go in with a figure in mind and the reason behind that figure, you don’t want to be caught on the back foot if they begin a negotiation process as this will be sure to fluster you and could diminish your case if they feel you have made an unreasonable proposal.

Tip from a Professional:

The tips above can be applied to negotiating in general as well, Natalie Reynolds, author of “We Have A Deal”, gives some great tips about how to negotiate a pay rise and the concept of anchoring, explaining how to use it to your advantage in the clip below. The concept applies to a variety of different negotiation subjects so it’s a great bit of Learning and Development in negotiation skills in general.