Top five excuses for sloppy finances

January 25th, 2008

Consumers make many excuses for the - often unhappy - state of their finances. The sub-prime mortgage market fiasco in the US has highlighted the importance of responsible lending, but has also drawn attention to the importance of consumer responsibility. Here in the UK where consumers enjoy a collective multi-billion pound relationship with credit, it’s obvious that Britons are less than shy when it comes to borrowing – but are we making the best decisions regarding our finances every time? Here listed are the top 5 excuses UK consumers make for sloppy finances; if any (or all!) of these apply to you, see the full article for more in-depth advice on how to mend your slapdash ways.

#1: My credit rating is already ruined
If you have a history of missed loan repayments, late credit card payments or have defaulted on your mortgage, you may think that the damage to your credit rating is already done, and is too late to fix. However, it’s never too late to turn things around and become a prime credit candidate, as your credit record lasts for only six years. With some planning and good decisions you can gradually improve your relationship with financial institutions and increase your credit rating. See the full article for more in-depth information.

#2: I’m saving instead of paying off my credit cards
You may believe that if you are saving for a particular expensive purchase or event, such as a car, holiday or wedding, there is little point in over-repaying credit card debts at the same time. This could not be further from the truth; racking up interest charges on a credit card will negate the interest earned on any savings. A clever shuffling around of your finances can help you to stay in control and keep your money working to your best advantage. See the full article for more in-depth information.

#3: I don’t understand financial matters, so I trust my bank manager’s advice
If you find financial matters too dull for words, or don’t understand the jargon, you may think that relying on your bank manager’s advice is a safer way to manage your finances than muddling through yourself. Actually, you may be much better off by taking matters into your own hands, as your bank manager may not have your money’s best interests at heart. Independent financial comparison services are a good place to begin in order to get yourself a better deal. See the full article for more in-depth information.

#4: I’m too young to worry about the future
The sooner you start taking a serious interest in your finances, the better. Whatever your financial situation, understanding the basics and planning for the future is important. Getting into good habits at an earlier stage of life can mean avoiding a lifetime of financial stress. This way, by the time you really need to start making serious financial decisions, you can avoid the common mistakes that lead to serious problems later on. See the full article for more in-depth information.

#5: I don’t have time to plan and budget properly
Having a good relationship with your finances requires a certain amount of time and planning. Setting out a budget and learning to manage your incomings and outgoings properly is a good place to start, no matter what your income. You may be surprised at where your money goes each month, and gaining an awareness of this can make a big difference to your finances, especially when considering major financial decisions such as loans and mortgages. See the full article for more in-depth information.