Personal Finance

Barry McCall provides us with realistic tips on tightening our belts and St. Patrick's Credit Union highlight their on-line application process.

Slimming down on spending

The human capacity to repeat the same mistakes over and over never ceases to amaze. Take for example the annual Christmas spending splurge. Every January, we wake up with an enormous financial hangover as a result of our December over indulgence – but do we learn? Of course we don't. In fact, these reckless excesses are now as much a part of Christmas as tinsel and fairy lights.

So there is no real point in making firm resolutions to amend our ways, we know we're not going to. The only answer is to treat the symptoms. Here is the equivalent of some financial paracetemol to help you get over the worst of them.

The first part of the medicine relates to your credit card. Most of these are charging rates of more than 1% per month on outstanding balances, so if you've run up a few thousand over the Yuletide and in the January sales you will probably be paying at least €30 a month in interest payments. Why not look out for one of the many cards out there that offer either very low, or zero interest on balance transfers for six or nine months. This will allow you to pay off your debt over that period while paying little or no interest.

The second thing to look out for on your credit card bill is payment protection insurance. Many people take this out when applying for the card without realising its cost or thinking about its usefulness. This insurance can cost more than your monthly interest payments and the vast majority of people never need to use it, so it might be a good idea to pick up the phone and cancel it.

If you have been even especially profligate and find yourself paying out hundreds in interest each month on a credit card without making any inroads on the capital owed, it's time to take some more drastic action. This involves getting yourself down to your credit union to talk about taking out a loan to pay off the total credit card debt. This will cost a lot less in interest charges and will reduce your stress levels greatly as well.

But remember, there is absolutely no point in going through this process if you are going to hold on to the credit card at the end of it. Cut it up or at the very least change it for one with a much lower credit limit – say a few hundred euro – to have for buying cinema tickets and so on over the Internet.

The next thing is to look around the home for savings and the easiest place to find them is the energy bill. Energy costs have increased fairly dramatically here in recent years thanks to world events. But this gives us even more scope for savings. Swap your incandescent bulbs for energy saving ones, check the lagging jacket on your immersion, check out the thermostat on your heating system and make sure that your hot water system is on a timer.

Finally, make sure you switch off the lights when leaving rooms. The last and probably most important thing today involves a pencil and paper, or a computer for those of us who have one. Make a record of every cent you spend for an eight-week period. This should include just about every regular bill and other types of spending you have.

At the end of the eight weeks look out for things you might have been able to get cheaper. Don't look for things you could have done without, nobody wants to live less comfortably, look for real savings. For example, might another phone provider be able to offer you a better deal? Is cable or satellite TV better for you? Is there a better value grocery shop near to you? Are you getting the best value petrol that you can. By being conscious of all these things you will become a wiser spender and a lot better off as a result.

St. Patrick's Credit Union (ESB Staff) Ltd. - On-line loan application

Members of St. Patrick's Credit Union can now apply for loans using the on-line facility on the website www.stpatrickscu.ie This online facility is in the Member's Area-accessible through the use of your secure PIN. The advantages in applying online are that it does away with having to locate and post a paper application form, while also speeding up the application process, resulting in members receiving their loan cheques a lot quicker.

The online application form has the same details and questions to be answered as the paper application forms, but it can be filled in and submitted to the Credit Union within a couple of minutes.

If a member has a Credit Union Agent in their workplace (A list of which is available on our website under 'Choose a Section' in the 'About Us' page) it is possible to receive the loan cheque the day after the online application has been submitted. To do this, all that is required is that the member agrees to having all the necessary documentation and the cheque forwarded to their Agent. This is a fantastic service unequalled by any Bank or Building Society. So get clicking now to get the application process started!

Don't forget that loan applications are judged on the repayment capacity of the individual member not on the amount of shares. Current loan balances do not have to be cleared before a member can apply for another loan. Also, don't forget that the current lending rate in St. Patrick's Credit Union is only 6.5% which is the lowest rate offered by any financial institution in Ireland for personal loans.