As the excitement of the New Year has faded, it’s time to start thinking about your money situation for the coming months. In the following brief interview, reps from Texas Lending discuss practical ways to remain on the road to financial security.
Q: How can I use last year’s budget to plan for this year’s spending?
Texas Lending: Understanding where your money was spent in the preceding year is a great way to figure out where you can cut back on next year’s budget. For instance, if you set aside $100 per month for entertainment, but did not use it, you can funnel that money toward something more important, such as getting out of debt.
Q: What types of debt should I try to pay off?
Texas Lending: Ideally, your financial goals should include getting out of debt completely. This includes credit card debt, vehicle payments, and student loans. But as a practical matter, it is advisable to leave small balances on your revolving debt and pay on time every month as this contributes to a solid credit history. Your credit scores will reflect that you are a low-risk borrower. With no current on-time payment history that comes with having no debt, your credit scores may not qualify.