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It’s the number one stress cited by small business owners – cash.

First on the New Year’s resolutions list for many is to rein in budgets, and finally get back into the black.

Jessica Darnbrough from Mortgage Choice commented that careful planning and strategic budgeting are key elements of staying on track.

She offered five pointers to help Australians stick to their financial resolutions in 2014:

1. Avoid unnecessary extras and costs: Evaluate your regular outgoings and identify any unnecessary costs that you can cut down or cut out. Cutting back on guilty pleasures like takeaway coffees, Friday night takeaway or premium television packages can lead to significant savings in the long term.

2. Think small when budgeting: Planning ahead with your finances for a full year can be daunting, and ultimately, ineffective. Instead, budget monthly or in accordance with the length of your pay period. This will allow you to amend your budget fairly quickly if you over overestimate or underestimate certain expenses.

3. Update your savings account: Research the benefits offered by savings accounts across various financial institutions. Switching banks and opening a new account with a lending institution that offers lower fees and higher interest rates will allow you to save more in less time.

4. Pay off and cancel your credit card: Credit card interest rates are notoriously high. Constant use without complete payment at the end of the month can lead to significant debt. Many people get stuck using a credit card and struggle to break the cycle as interest continues to accrue. Make paying off your credit card a priority early in the year, and cancel it as soon as possible. Debit cards are an ideal alternative, providing a similar level of protection for online and over the phone purchases, without the significant interest rates.

5. Compare to find a better deal: You may be paying more than is necessary on your home loan, insurances, utility bills, etc. Comparing your options via a mortgage broker or comparison websites can help you find the best deal suited to your needs and save you money in the process.

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