Debt counselors build financial safety net as more than half of Britons say they are struggling
Although Britons thought it was the most important financial task to accomplish, 66% find it very difficult to build a financial safety net.
Almost a quarter of Britons (22%) also struggle to manage their loans and debts, and one in ten (9%) cannot keep up with their regular bills and payments.
Many of us struggle with the many tasks that lead to financial security According to The Debt Management Group Lowell who conducted the latest research.
A financial safety net is an amount of money that you use in an emergency or unforeseen circumstance.
It is recommended that each person have one for unforeseen expenses, such as car repairs, boiler repairs, vet fees, or even in the event of your job loss.
Debt experts say a good safety net can cover three to six months of your expenses, but that’s a challenge for many people.
If you’re already struggling with personal finance issues, this, aside from saving for a big purchase and finding ways to make more money from your assets, can seem like an impossible task.
Four ways to start building a safety net
John Pears, Managing Director of Lowell, offered his step-by-step advice on how to get the most from your money:
- Put Your Debt First – Paying off your excess debt is the best way to put yourself in a comfortable financial position where you can consider saving for emergencies and getting the most out of your money.
- Start small – although a jar of spending three to six months seems pretty overwhelming, this should be considered your end goal. Even amounts that seem small at first will add up over time, and before you know it you’ll be much further along than you might think.
- Prioritize your needs, wants, and savings – when figuring out how much you can save, get in the habit of understanding your needs and wants. List your absolute needs, wants, and luxuries. Then you can get a very clear idea of what you can put away each month.
- Do a financial spring cleaning – take a look at all your in and out and see if you can cut any, combine payments, or cut anything. See where most of your money is going each week and see where you need to cut back
What are the money management tasks that people have the most difficulty with?
- Build a financial safety net to fall back on if necessary – 66%
- Savings for specific long-term purchases – 60%
- Finding ways to make more money from savings and assets in the future – 59%
- Save for experiences and activities – 52%
- Stick to a budget – 33%
On a positive note, 80% of Brits find it ‘easy’ to keep track of their bills and regular payments, and 67% of people say they can track their spending well.
Research has also shown that Britons believe that putting in place a financial safety net is the most important personal finance task people should do (37%), followed by 24% who believe that find ways to make more money from savings and assets and 22% who believe they are on a budget is the most important.
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