|September 17, 2018||Comments Closed|
There’s no doubt that financial difficulties can lead to a lot of stress in our lives. Incessantly fretting about how you’re going to pay your bills not only makes you distressed, but also puts stress on your relationships, your family, and your health. The fact is, stressing over money isn’t going to fix your financial problems. If you’ve found yourself in a situation where you’re struggling to make ends meet, here are the best ways to resolve your financial challenges so you can live a worry-free life again.
List your monthly costs
The first step in taking care of your financial complications is find out exactly where your pain points are. Regardless if you’re dealing with a large credit card debt, you’re trying to increase your retirement savings, or you just spend too much on eating out during the week, pinpointing the main causes of your financial troubles will show you which expenditures must be prioritised so you can get your finances back on track. Grab a pen and paper and jot down your current monthly costs including debt repayments, food, bills, tuition, transport, and any other items you usually spend every month.
Decrease your expenditures
Once you’ve got your monthly expenses in front of you, take a closer look and find which expenses can be minimised and which can be cut out altogether. Although your mortgage repayments clearly can’t be decreased, you can possibly lower your food bill by only eating at home and even do away with other entertainment expenses like cable television. It’s essential that you are pragmatic about minimising your expenses. Remember, if you’re dealing with financial issues then you have to make sacrifices to resolve them.
Develop a budget
Now that you’ve got your monthly costs written down without the unnecessary spending, you have to construct a budget. If you’re not familiar with developing a budget, there are lots of fantastic apps you can download on your mobile phone. Personally, I’ve found the Budget Planning app from ASIC to be very practical: 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 each month by looking at your income and expenses. It’s essential that you stick your budget. If you think that it could be too difficult to do this, add a miscellaneous item to your budget to give you some room to breathe, or perhaps a motivation item to reward yourself at the end of the month for following your budget.
Prioritise your debts
Some debts cause more strain than others, so to alleviate your financial strain as best as possible, aim to reduce your biggest debts first. Not only will you be saving money by paying less interest, you’ll also feel far better about yourself. Only paying the minimum repayments on your credit card bill can sometimes take years to pay off, so try to decrease these types of debts as quickly as possible. Bear in mind, you still have other fixed debts every month including phone bills and electricity, so these need to be taken into account as well.
Still feeling the heat?
If you’ve lowered your expenditures and developed a budget but still find that there’s not enough money to pay off all your debts, you’ll have to find other sources of income. 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 and friends is another helpful way to try to address your problems. Whatever you do to get additional money, never get a personal loan from the bank to pay off your existing debt – this will only exacerbate an already stressful situation.
Seek financial guidance
If the above steps haven’t relieved your financial pressure, it’s better to seek financial advice sooner rather than later. Depending on your individual situation, there are lots of options available including debt consolidation loans or debt agreements which can help those in need. Don’t wrestle with your debts for years before getting assistance, speak to Bankruptcy Experts Bendigo on 1300 795 575 or visit our website for more information: www.bankruptcyexpertsbendigo.com.au