Controlling Your Daily Finances

What is your monthly disposable income? This is a question very few of us could answer without thinking about it. Maybe now is a good time to think about how you control your finances and devise a budget for spending, saving and staying in control of your money.

Start by itemising your expenditure. Include:

• all repayments on borrowings (car, mortgage, credit card, store card, other loans)
• living expenses (household items, car insurance, tax, petrol, gas, electricity, phones, cable TV, refuse collection, insurance, shopping, holidays, education)
• regular savings if you make any

Next, detail your income from salary and any other sources. Does your income cover your expenditure? Are there any areas in which you could economise and free up some more cash?

One way to gain greater control over your cash flow is to open a special budgeting account, such as AIB's Masterplan Account. This allows you to spread your payments evenly throughout the year. You can also pay most utility bills by direct debit or at a monthly fixed standing order. Take a look at your phone bills. Are you on the right mobile phone tariff and is the amount you spend on this item proportionate to the other demands on your cash?

Are you keeping your money in the most suitable account? The days of a pay cheque on a Friday afternoon are long gone. Now, most people are paid via the transfer of funds to a bank account. This applies equally to the self-employed, as suppliers switch to electronic payments. A current account is the ideal place to keep the money you use for living expenses. Please see our related information section for details of AIB's range of Current Account offerings.

On-line and telephone banking allow you greater flexibility in the management of your daily finances. You can schedule your bill payments in advance and a quick daily check on the balances of all of your bank and credit card accounts may help keep any impulse spending in check! For details of the features of AIB Internet Banking, or to apply for it online, please see our related information section.

Use your plastic money smartly. Debit cards such as Laser Card operate like an electronic chequebook. They are a very convenient way to pay for purchases and the majority of retailers who take them also offer a cash-back facility within certain limits. Try to think of your Laser Card as cash and take a few minutes every day to keep track of how much you've spent. This will help keep the tabs on your daily spending.

Credit cards such as MasterCard and Visa give you convenient, instant access to credit. You can make a purchase and effectively defer paying for it for almost two months. Great if you pay promptly, more expensive if you don't. To avoid interest charges you must clear the bill in full each month.

If you tend not to clear the balance each month, consider a switch to a low-interest card. Interest is charged on a daily basis, from the date the transaction hits the account - like an overdraft.

Once you've identified any areas in which you can make some savings, set a budget for how much you want to spend in certain areas. Then decide what your own rules are for controlling your money going forward. Here are some ideas:

• Pay credit card each month to avoid paying interest - set up a direct debit to make sure it gets paid on time.
• Be aware of potential credit card fraud - on the phone or Internet buy only from reputable firms and always keep your card within view when using it in a shop or restaurant.
• Consider opening a Budget Account which is a credit facility that enables you to plan the payment of various bills while spreading the costs evenly over a 12 month period. Please see related information for details of the AIB Masterplan Account.

Legal Notice

The information provided in this guide does not constitute tax, legal, investment or any other advice. Any figures quoted are correct as of publish date shown above and are subject to change.

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