How To Audit Your Financial Life

Money can seem complicated. But in reality, it’s only ever as complicated as you make it. It may not feel like it, but you will always find that you can improve your situation, no matter what it looks like now. When you firmly believe that you’re stuck and that you’ll never get to where you’ll be, this is just something in your mind. So you need to shake that off, really get to grips with your situation and start to turn things around. The best way to do that is to be really objective with yourself. Even if, right now, your situation isn’t that bad, you can really make a change and improve things going forward. And if you have big dreams, then this is something that you’ll really want to do.

Cathryn Lavery
But what’s the best way to go about it? Because you know roughly where you are now, and you know where you want to be, but how do you make that leap? This is what the audit will help you with. It’s going to help you to break down your current situation and really figure out what changes you need to make in order to get to where you want to be. And there are always changes that can be made. So let’s see what they are.

 

  1. Set Some Goals

 

When it comes to doing anything in life, you need direction. So when you’re looking to make changes to your financial life, you need to have goals. So start out your financial audit by having a vision of what you want to achieve. Whether you want to buy your first home, launch a business, or just build up some firm savings, these goals are essential. Maybe you even want to transform your lifestyle? When this is the case, putting those goals in place is the first step for helping you to do it.

 

  1. Break Down Your Pros

 

The next step is to begin the audit of how you are right now. And to do this, you really have to be objective with yourself. You need to make sure that you can highlight the strengths that you have. Maybe you spend within your means? Maybe you’ve created a savings account? Maybe you earn well? Whatever it is, make sure you’re aware of any positive things about your current situation.

 

  1. Understand Your Cons

 

Next, we have the hardest part to do. Because you have to be able to understand your flaws and your weaknesses if you’re going to turn things around. And to do this, you have to be quite tough on yourself. Be honest and work what’s letting your current financial situation down. Maybe you’re in a lot of debt? Maybe you can’t control your spending? Maybe you earn pittance? No matter what it is, work it out, and own it.

 

  1. Budget Better

 

Now that you are more than aware of how you’re doing, it’s time to budget. By building a better budget, you will be able to take control of your earnings. You’ll find that you can start to really allocate your funds in the most cost-effective way. You’ll often reduce unnecessary payments that you make and start to get smarter with how you view your money.

 

  1. Spend Smarter

 

From here, you then need to be able to make your purchases count. Start by switching your bills to better deals. Use sites such as moneypug to find them. When you can save money on your bills, you’ve made the best start. Then, you’ll want to cut out expenses that you don’t need altogether. This is going to help you to free up cash for your financial goals.

 

  1. Home In On Your Earnings

 

When you’ve got a better grasp over your outgoings and you’re really starting to control them, you then need to do the same with your income. Ideally, you’re going to want to increase your earnings. The best way to do that is to work on getting a raise, go out for more work, or to even diversify your income by adding an automated stream.

 

  1. Keep Everything In Line

 

Finally, you then need to make sure that everything matches up going forward. The decisions you’re making with regard to your money have to link to your goals. Essentially, your actions have to match your ambitions. So be sure that everything you do, every time you spend, and your attitude towards your financial situation all mirrors those original goals that you set out.

Keeping costs down

It can be said that sometimes we think with our hearts and not with our heads. Making New Year’s resolutions can often be disastrous, with 80% of people failing by February and regretting it instantly. One of the most common New Year’s resolutions is to cut down on spending, and although this sounds achievable, if you don’t have a fully-pledged strategy in place, the likeliness of failure spirals out of control. I’ve done it myself so I’d be surprised if you hadn’t!

Yes, occasionally we can be victim to an unexpected expense — whether this is a home appliance breaking or making that third trip on a bus with only a return ticket. It all adds up. So how can you keep costs down?

 

Travelling

Start off with something small, but something that will make huge changes when it comes to your bank account. Using a megarider ticket, you will be able to travel as much as you want and can tailor your own needs to the ticket type. Whether you’re in need of a weekly bus pass for your travels, or a monthly one — you will find yourself making a huge saving in comparison to buying a ticket every day.

Are you a driver?Did you know that the average motorist in the UK will spend an astonishing £168,880 over their lifetime? Doesn’t that seem like a crazy amount of money? Why not consider efficient public transport instead?

Annually, petrol costs a driver £1,052.04. Servicing a vehicle costs can add up to £441 annually — which can change depending on the individual’s situation. MOTs can cost up to £168.46 annually. Cost of parking is on the rise, and over the year, a motorist can find themselves paying £145.80 on parking. When it comes to insurance, this can sway dramatically as younger drivers will find themselves paying a higher cost to be on the road — on average, insurance costs an experience driver £436 every year. Tax can equate to £116.35 on a yearly basis. Car supplies can cost a driver £29.61 and if you were to go abroad and wished to drive, holiday rental cars can leave you £180 out of pocket.  That’s not all!

Speeding tickets equal £25.12 for the average driver here in the UK. This would cost a driver £2,594.38 in total where commuters find themselves paying considerably less for a significant service — imagine the saving you would make with a megarider ticket!

 

Lifestyle

Coffee

According to research carried out by MyVoucherCodes, people in the UK visit coffee shops at least three times per week —currently there are over 21,000 outlets around the country! This means that Brits visit coffee shops around 156 times a year with an average spend of £8.52 — with travel expenses, this could go up to £13.85. This creates an annual average spending of £2,600, a majority of which could be saved if you were to opt for taking your own coffee to work.

Branded coffee company, Douwe Egberts, has said that a 250g pack of ground coffee can make up to 30 cups. When looking to see how much a 1kg pack would cost, Amazon has priced the coffee at around £15, meaning that each cup of coffee would cost close to 13p. Try taking a flask to work and even purchasing an on-the-go coffee cup that will see you through your day.

 

Smoking

If the rise in prices for cigarettes hasn’t already put you off, did you know you could save a whopping £3,796 (if you smoke 20 a day) – surely this should be the driving mechanism for you to quit. MoneySupermarket.com has stated that non-smokers pay around £6,309 less for life insurance, which could be something worth investing in for the new year. I know that now Steve’s life insurance when he smoked was always much higher than mine per month.

An alternative that many smokers are trying to save money is vaping. 10ml bottles of liquid cost around £5 on average — saving those who turn to vaping around £1,900. This also can be quite costly though. Quitting altogether is a much better choice.

Lunch

Forking out for lunch every day could cost you £1,288 according to research carried out by VoucherCloud. Evidently, you could make a huge saving by preparing your lunch at home — whether this is making a quick sandwich or taking in a tin of microwavable soup to heat up. When we looked at the total working days in 2017, there was 252 — if we went by Poundland’s price of tomato soup, which is 50p, you would find yourself paying £126! A massive saving for anyone looking to cut down on costs.

 

Unexpected expenses

We’ve all been victim to an unexpected expense, with 54% of 2,000 people asked saying that they suffered from an unexpected expense within the household. On average, these costs totalled £248.70 — showing that any saving is beneficial for occurrences like these. 47% of these issues happened in the kitchen, a room which is essential to the day-to-day running of any home, and if you don’t have the money to pull out instantly, it could cause an everyday stress. With the money you’ve saved taking your own lunch and coffee to work, quitting smoking, and travelling smarter — you will be able to make life easier on yourself and your family. It was also found that 35% of people had to use a credit card to cover the costs of unexpected expenses. With 18% of them not being able to pay more than £100 on their own, 17% had to borrow from friends and family!

Thinking smarter for 2018 is a must, how will you be changing your ways to save money?

Collaboration

What You Need To Know Before Selling Your Business

No matter how desperate you may be to sell your business, this is not a process that can be rushed. Every business sale requires a lot of preparation and consideration. The last thing you want to do is sell your company, which you have worked so hard on, to the wrong person or for the wrong price. With that being said, read on to discover some of the key things you need to know before you sell your business.

Expect to answer a lot of questions – There is only one place to begin, and this is with the plethora of questions that are going to come your way. You need to be prepared to answer a shed load of questions if you are selling your business, especially if your company is run completely online, which is becoming more and more popular in the current day and age. Do not judge a buyer for asking you these questions and do not get frustrated with them. Put yourself in their shoes. This is a big sale and a big commitment. They need to make sure they know the ins and outs of what they are letting themselves in for.

Buyers are not going to pay more for potential – A lot of business owners make the mistake of thinking that they have a potential gold mine on their hands and so this means that they are going to be able to make a fortune off the sale of their business. Unfortunately, it does not work like this. Perceived potential alone is not enough to command a high selling price. If you do not have a proven revenue stream, where is the value going to be? The vast majority of your buyers do not want potential, they want something that is already proven and established.

Olu Eletu
There are many costs to take into account – There are so many different costs that you need to take into account when selling your business. This is why it is vital to draw up a financial plan so that you can effectively budget for all of this. This includes everything from the tax on sale of shares to securing legal assistance for the handling of the transaction.

Be honest – Last but not least, the importance of being honest cannot be stressed enough. If you bend the truth or avoid it, you are always going to end up experiencing bigger issues later down the line when the truth surfaces, which it will. If you are transparent and honest from the very beginning, there is less chance of the deal going sour because the buyer has uncovered something while carrying out due diligence.

As you can see, there is a lot that needs to be considered and taken into account when selling a business. If you take note of everything that has been mentioned above, and you follow a careful and considered approach, you can make sure that your business sale goes as smoothly and successfully as possible.

Collaboration