Personal Finance: 10 Sites to Get You Started

If you feel the time has come to sort out your finances consider following these easy steps. It is not a comprehensive list but something that I have tried out myself. This list focuses on basic steps that are very important to get right. It might take a day, but most likely to
take a bit longer if you never looked at your finances  in detail before ...

Budget

Create your budget using account statements from the las two or three months. This is probably the most laborious part and can be quite daunting, especially if you tend to overspend. I personally found it easier to do as-is budgets for my friends rather than for myself.

TIP: ask a friend to do it with you. They are likely not to "overlook" anything and will ask probing questions. You can use online or offline tools:

1. mint.com - is a very popular online budgeting and financial management tool. It is very powerful and provides some interesting charts and reports. The downside it works only in US as it only can upload accounts from banks operating in the States!

2. Budgetplanner is an online version of a very popular Excel based tool, created by Martin Lewis from moneysavingsexpert.com. It doesn't offer any forecasting reports, but it is very simple to use (hence easier to stick with it and not abandon mid-way).

3. Budgetpulse is very similar to mint.com with a great bonus: it works all over the world! It works with most of the currencies, recognizes bank accounts from all over the world and has a suite of nice reports

4. Wesabe is a cross between budgeting tool and a social site of like-minded people. It's a bit basic in its functionality but offers you a lot of motivation and support from other users

Debt management

One part of your budgeting might be looking into how much you are paying for your loans, credit cards and overdrafts. Consider changing the way you paying your debt off. There are a lot of models on how to pay debt off. The most popular are:

5. The Snowball: hereby you pay off first your smallest debt to achieve a "quick win" that will make you feel happier. Once the first debt is payed off you take the amount that you were paying towards your smallest debt to pay off the next one on the list.

6. The Avalanche: the mathematically superior tactic. Hereby you pay off the debt with the highest interest rate first.

7. A combination of both, called Deluge. You list your debts from smallest to largest pay off the smallest first and than use that money to pay off the largest.

8. Whichever you go for, here is a great tool: Debt Reduction Calculator - it helps you calculate payment details and shows you how much interest payment you will save and it works for any of the debt payment models mentioned above.

Socialise

You may feel on a high once your budget is sorted and you have a feeling of getting more control over your debt. But sooner or later, especially if you found out that you need to spend less, you may feel need of support!

9. Join forums of like-minded people

10. Find out how to keep on track. William Poundstone, sais

' It turns out that this common decision can be influenced by all sorts of subtle psychological tricks. The science is affecting the design of price tags, menus, rebates, ‘sale' ads, cell-phone plans, infomercials, tort demands, and corporate buyouts. In a lot of ways, prices are the most pervasive hidden persuaders of all."

Have I missed something essential off this list? Do you know a better tool or approach to budgeting and / or debt management?

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