Using banks to help your family budget
Banks provide many personal banking products to families throughout Australia, but how can you use common products from the banks to help your family budget? With a little ingenuity and a small, regular investment of your time you can arrange your finances in a way that will maximise your debt repayment and make your money go further.
Choosing the right products from the banks is the first step in improving your family budget. Before you can set your budget right, you must first set up your debt to be as manageable as possible. If you have a personal loan for a car or a home loan, then debt consolidation through refinancing either of those to cover other debts can greatly simplify your debt management. This can also be a good opportunity to take advantage of any redraw facility you can add to the major loan. A redraw facility may cost you slightly more, but it will allow you to reduce the interest you are charged each day by leaving as much of your money paying off your debt as possible at any one time.
The next step is choosing the right credit card. If you believe that using credit cards as a line of credit leads to massive debt, then you are right. If you think that's how credit cards should be used, then you are wrong. Banks design credit cards to suit many different individuals, and they intend to make money off all of them. Smart customers can use credit cards to their advantage, however, and end up gaining more through reward points than they spend on annual fees. The key to this is interest free days on purchases.
If you only use your credit card as an alternative to cash so that you can get reward points and you pay off your entire balance before the interest free period runs out, then you can essentially earn extras for your normal spending. Some cards even offer cash backs on reward points, allowing you to directly see the bonus made to your family budget.
The other bonus to using your credit card correctly is that you can leave all of your money in your debts for as long as possible. The right credit card with the right usage could mean you aren't just paying the banks less - the banks are paying you to shop!
If you don't have any debts but your budget could still use help with the right products from the banks it may be a good idea to look into high interest accounts and other relatively stable investments such as mutual funds. If you can maintain a low level of expenditure, then your savings could easily be maximised with term loans or wise investments. You may wish to consult a financial planning service to help you decide where your money would be most effectively invested.
Please visit our various comparison and informational pages to learn more about the best products from the banks.
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