GST is to be implemented in less than a month, and the price of most goods and services are expected to hike. Which translates into a tighter budget for most of us not lucky enough to receive an accompanying salary bump.
An increasing cost of living does not necessarily dictate a compromised living standard. Even if your wage remained the same, you can always optimise your budget to get more mileage out of it.
Think of the impending price hike as an excuse to perform a financial audit on yourself. Here are a couple of money saving hacks to help you optimise your budget.
## Audit Your Subscriptions
While self-renewing subscriptions and direct debit payments are convenient, they sometimes result in lingering subscriptions for services we no longer use that are sapping money from our accounts on a monthly basis.
Comb through your bank and credit card statements to check for any automated direct debit payments for services or subscriptions that you have ceased to use and forgot about. If there are any; get rid of them. It’s also helpful to keep a tab on your ongoing subscriptions and services.
One of the dangers of direct debit or standing order payments, is that you may not realise if any extra charges were heaped on, especially when it comes to services where you could unknowingly accrue extra charges like mobile phone subscriptions.
Also make sure to check after you’ve canceled a subscription to see if they are still charging you. Sometimes the service provider could be a little cheeky.
We are not implying that you should avoid the conveniences of automatic billing. Automated billing is a great tool to help you pay your bills efficiently; just make sure you keep tabs on the number of direct debit charges you have set up.
Balance Transfer to Manage Your Debt
Balance transfers allow you to consolidate your credit card debts into a single card, usually a card with a low interest rate. Balance transfer plans usually entails a certain number of months where your debt on the card receiving the transferred debts would incur no interest or a very low interest rate. Note that some plans charge an upfront fee.
Browse through your array of credit cards and determine if it’s worth transferring their balances to a single card with lower interest. That could save you a significant amount of interest payment if you are not one of those who pays off their credit card balance completely at the end of every month.
A balance transfer is a useful tool to help you restructure your credit card debt to reduce your interest rate and render them more manageable. If you are interested to find a card for balance transfer, find the perfect card with low or zero interest to transfer your balance on our card comparator.
We would also advice you to go through our article on balance transfer prior to applying for one.
Opt for Installment Plans
Installment plans can come in handy if you plan to make big purchases with your credit card in which you don’t intend to pay off quickly.
Most major banks offer 0% interest installment options for their credit card holders.
Making use of the installment plans like Maybank’s EzyPay and CIMB’s Easy Pay instead of paying for the item in full upfront using your credit card could save you a significant amount of money in interest charges. You can find out which credit card offers an installment plan here.
Alternatively, you can form your own version of installments. Layaway is a purchasing method where the buyer places a deposit to the seller to hold on to a product and proceeds to pay the seller in multiple small payments until the product is paid in full, in which the seller would release the sold product to the buyer.
While layaway is not practised in Malaysia, you can lay away a sum of cash in your savings account every month until you have enough to purchase the item you have set your eyes on. There’s the added benefit of giving you time to think. If you are still intent on making the purchase by the time you’ve saved up for it, it’s probably not an impulsive purchase.
There are always ways to optimise your budget. If you can’t increase your income; squeeze more out of it then!