Prepare yourself: New year, same old expenses

The beginning of the year is marked by expectations of a better cycle, renewal and new plans. But also a lot of commitments, such as the bills and fixed expenses for this period.

According to a survey by the Central Bank and the Brazilian Federation of Banks (Febraban), 70% of people spend all or more money than they earn.

If this is your situation, it’s time to turn the tables and prepare yourself financially for the main costs of the start of the year.

To help you, we’ve listed some of the expenses already expected for 2024:

IPTU

The Urban Property Tax – IPTU, is a municipal tax levied on those who own property in the country’s urban areas. It can also be paid by the tenant, in the case of renting a house or apartment, depending on the contract with the owner.

IPVA

The Motor Vehicle Ownership Tax – IPVA, is a tax levied annually on anyone who owns a car.

DPVAT

DPVAT – Personal Injury by Land Motor Vehicles, is a compulsory insurance paid annually by car owners in Brazil.

Vehicle licensing

Annual Licensing is a tax collected by Detran – the State Traffic Department. It is a process of regularizing cars, allowing them to travel freely on the country’s streets and roads. On your state’s Detran website, you can check the due date for this license, as it varies according to the end of each vehicle’s license plate.

Insurance

If you’ve considered the above, you probably also have some form of insurance, be it home, car, life or other, which is renewed annually. In some cases, contract renewal payments are made at the beginning of the year, so consider it as one of your expenses.

School expenses

Do you have children? Then you should also take into account school expenses, such as school materials, uniforms and, if the school is private, the cost of enrolment and tuition fees, which may even increase with the change of year.

Now that we’ve highlighted some of the main expenses you’ll be facing, the question may be how to prepare to pay them. So ask yourself:

What is the total amount of my expenses?

“Materialize” your debts, calculate all your expenses and arrive at a final or approximate figure. List EVERYTHING! It’s important that you know your scenario well, because that’s the only way to prepare for it.

Another important tip is to list the order of priority for payment, knowing the application of interest in case of delay and discounts in case of anticipation.

How much do I earn x how much do I spend?

Knowing that your credit card limit does not make up your monthly income is essential for making good decisions about how you spend your money.

Consider all your earnings: salary, PLR and extra income, for example, and assess whether your current lifestyle fits within your monthly income. If the answer is no, it’s time to cut some expenses.

Is everyone at home committed to financial planning?

Financial planning should be done as a family, everyone should do their bit to help get out of debt and save money. A chat to align expectations and upcoming bills is part of good financial organization. Emphasize that balancing the accounts will bring more security and peace of mind to everyone.

These small, initial analyses can give you an idea of how to start preparing.

Don’t forget to consider your Vexty Plan as a fundamental part of your financial planning.

And if something comes up or you want to swap an expensive debt for a cheaper one, find out more about our Conscious Lending Program.

With you at all times. Vexty. Absolutely.