Tips on How to Deal With Your Financial Troubles
There’s no doubt that financial concerns can trigger a lot of stress and anxiety in our lives. Incessantly thinking about how you’re going to pay your bills not only makes you apprehensive, but also puts stress on your relationships, your family, and your health. The fact is, worrying about money isn’t going to fix your financial troubles. If you’ve found yourself in a situation where you’re battling to make ends meet, here are the best ways to manage your financial complications so you can live a stress-free life again.
Write down your monthly costs
The first step in managing your financial challenges is discover exactly where your pain points are. Regardless if you’re dealing with a large credit card debt, you’re trying to boost your retirement savings, or you simply spend too much on eating out throughout the week, pinpointing the main causes of your financial concerns will show you which expenses must be prioritised so you can get your finances back on track. Get a pen and paper and document your current monthly costs including bills, debt repayments, food, tuition, transport, and any other items you normally spend each month.
Cut down on your expenses
After you’ve got your monthly expenses in front of you, take a closer look and find which expenses can be lowered and which can be eliminated altogether. Even though your mortgage repayments certainly can’t be decreased, you can most likely lower your food bill by only eating at home and even eliminate other entertainment expenses such as cable TV. It’s imperative that you are pragmatic about reducing your expenses. Remember, if you’re trying to overcome financial troubles then you must make sacrifices to resolve them.
Set up a budget
Now that you’ve got your monthly costs jotted down without the unnecessary spending, you must develop a budget. If you’re unfamiliar with making a budget, there are loads of terrific apps you can download on your mobile phone. Personally, I’ve found the Budget Planning app from ASIC to be very useful: https://www.moneysmart.gov.au/tools-and-resources/calculators-and-apps/budget-planner.
This will enable you to calculate how much money you have left every month by examining your income and expenses. It’s vital that you stick your budget. If you feel that it could be too challenging to do this, add a miscellaneous item to your budget to give you some room to breathe, or maybe a motivation item to reward yourself at the end of the month for following your budget.
Prioritise your debts
Some debts cause more distress than others, so to alleviate your financial strain as best as possible, try to reduce your largest debts first. Not only will you be saving money by paying less interest, you’ll also feel much better about yourself. Only paying the minimum repayments on your credit card bill can sometimes take years to pay off, so attempt to lower these kinds of debts as quickly as possible. Always remember, you still have other fixed debts each month like phone bills and electricity, so these need to be factored in too.
Still feeling the heat?
If you’ve cut back on your expenditures and constructed a budget but still find that there’s not enough money to settle all your debts, you’ll need to find other income sources. Are you able to work a second job? Can you sell any high priced household items that you can do without? Reaching out to family or friends is another helpful way to try to deal with your troubles. Whatever you do to get additional money, never get a personal loan from the bank to settle your existing debt – this will only intensify an already stressful situation.
Seek financial advice
If the above steps haven’t relieved your financial pressure, it’s better to seek financial assistance sooner instead of later. Depending on your individual circumstances, there are lots of options available including debt consolidation loans or debt agreements which can assist those in need. Don’t fight your debts for years before seeking assistance, talk to Bankruptcy Experts Geelong on 1300 795 575 or visit our website for additional information: www.bankruptcyexpertsgeelong.com.au