M0NEY TIMES WITH JILL KERBY - SINCE New Year’s resolutions are inevitably broken, allow me to suggest an alternative approach for the achievement of your good personal finance intentions for 2016: my top 10 money-making or money saving targets that you can tick off at yoiu leisure.
The aim of the following list, however, is to reach the end of next year, hundreds, if not thousands of euro better off than you were in 2015. They are in no set list of order, so pick the easiest ones first to give yourself some momentum and try and complete one per month for the next 12 months...
1: Shift all your bills and payments onto a direct debit/standing order system in order that you never miss, or are late making a payment and incur interest penalties or surcharges. If you can, avoid paying monthly for motor/ home/health insurance payments. These can also add hundreds of euro to your total bills.
2: Switch to free banking and save an average of €120 a year in fees/charges. If you can’t keep the high minimum amount in your current account, consider opening a nil-charge credit union or post office account.
3: Cut your annual food bill by at least 5% by cutting out processed junk food: fizzy drinks, crisps, sweets which can typically amount to €7-€10 a week in a typical family budget or €375 - €520 a year. Smoke one less package of cigarettes or bottle of wine a month (c€10 x 2); one fewer shop-bought cappuccino (c€2.50) a week for 48 working weeks; one less pint of beer a week (c€4.50) and save €120, €120 and €234 respectively or €600 if you both smoke cigarettes and drink coffee, wine and beer. (If you are a heavy, pack of cigarettes a day smoker and give them up entirely in 2016, you’ll save an extra €3,530!)
4: Earn up to €12,000 a year, tax-free by renting a room(s) in your home under the Renta-Room scheme.
5: Cancel all unused or underused subscriptions: magazines, broadband extras, gyms, slimming clubs, sports clubs, etc. (Cutting out an under-watched TV sports channel has just saved us €480.) But join a holiday home swop company and you could this years’ holiday accommodation free, anywhere in the world or as much as 60% of the entire cost.
6: Claim all your (qualifying) medical/dental expenses that are not already covered by private health insurance and get a 20% refund from the Revenue. A family that spends €1,000 on GP/consultants visits, blood tests, physio, x-rays, ambulance fees, special foods (for diabetics, coeliacs, etc), medical equipment (like purchase of an orthopaedic bed, wheelchair, walking aids, etc) will get a €200 tax refund.
7: Claim other tax refunds - four years in arrears - for being a home carer of a child/ elderly person (€1,000) private pension contribution (40% tax credit), private health insurance (20%), rent relief, third level fees, etc. (See Revenue.ie PAYE Anytime)
8: Start charging your resident adult children, if they are working or receiving welfare benefits, for rent, food, utilities, the use of your car/petrol, etc. Even just €100 a month is worth €1,200 a year - to you.
9: If you haven’t switched your energy provider, mobile/broadband provider, health insurer, motor/house insurer in at least the last two years, do so. Bonkers.ie suggests that a typical household can save as much as €1,000 a year. (This column has shown that value of savings from switching health insurance plans alone.)
10: Buy or drive a smaller engine-sized car and save hundreds on taxes and insurance. Drive a classic or vintage car (ie over 30 years) and pay a flat, annual road tax of €56 and very low insurance, regardless of the make.
11: Get a professional, independent, impartial financial review of your personal taxes; your insurance contracts, including life/protection policies, your pension plan and mortgage. This could save you not just hundreds of euro this year, but tens of thousands of euro over your working lifetime. From this list alone, a household that hasn’t shopped around for insurance, utilities, mobiles and broadband, buys rather than makes their own sweet treats or desserts, hasn’t claimed the last four years of medical/dental expenses; includes a single smoker and two modest cappuccino/beer and wine drinkers could be looking at easily saving as much as €2,000 or more in tackling just those related tasks on the list above. By switching just one current account to a credit union and cutting out one unused gym membership and they’d probably save another €300. If you start thinking differently about the cost of servicing your mortgage, investments, the cost of holidays and car ownership and you could be in the best financial position in years by the end of a very Happy New Year 2016. Meanwhile, the latest edition of the TAB Guide to Money Pensions & Tax 2016 (€9.99), which I co-author with tax and financial advisers, Sandra Gannon and Neil Brooks (see www. tab.ie) is now on sale in all good bookshops.
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