Do your money troubles keep you up at night? If Suze Orman were to take a peek into your financial life would she be likely to slap you silly? Are you fully aware you are a mess, and know things need to change, and fast?
Well, if you are at that point, congratulations, because you are now way ahead of most people in your situation. The cloud of denial has lifted, and you are ready to take control. Here are just a few financial tips and helpful hints to get on the path to a financial health.
Take Stock of the Situation:
Sure, you know you have money problems, but you probably yet to sit down and really assess the situation. Before you can begin to truly fix things, you need to get a clear picture of what you are working with.
- How much debt do you have and to whom do you owe this money?
- What money problems are you continually running into time after time?
- Do you consistently find yourself running out of cash before your next check comes or are you being a bit too loose with your credit cards?
It won’t be until you give your situation a good, honest look, you can formulate an effective plan of attack.
Make Friends with a Budget:
Most of see ‘budget’ as some sort of dirty word; it makes us think of sacrifice, and doing without out. But, that is just one perspective, and a crappy one at that; one that keeps us from giving it a serious try. By making a budget, we would have to admit our money handling ways now are problematic, and we would much prefer to live in denial. But, how has that been working out for you? Not too good, right?
It is time to adopt a better perspective on making a budget. See it as a friend, not a foe. See it as a powerful tool to improve your financial situation. It is simply a means to manage your finances more effectively—it is about taking control and deciding where your money is going.
The first thing you need to do is map out how much is coming in and how much is going out. Group your expenses. The first thing is figuring out all the set, non-negotiables, like your mortgage. Then, you want to focus on regular expenses that may have some room for improvement, like your grocery bill or insurance.
When it comes to discretionary spending, be realistic in creating your budget for this—you don’t want to take an attitude of being ‘entitled’ to recreation, and spending whatever you see fit because it’s your money, but you don’t want to be unrealistically austere, either. There are no hard and fast rules—ultimately, you know if you are going overboard or not, and where you can cut spending. Be honest with yourself on this one guys.
Set specific goals for savings and debt repayments—factoring these into your budget will make you more likely to actually put your money towards them.
Seek Financial Tips if You Need It:
If you are struggling with your debt, there is professional help available to you. Credit counseling agencies offer information and services to help you create budgets and take other steps to improve your financial situation; they can also reach out to creditors to negotiate debt repayment plans on your behalf. Be wary of ones that advertise their services as an alternative to bankruptcy—they sometimes employ tactics that can make your financial problems worse, such as requesting you stop paying creditors altogether in hopes they will reduce your debt and accept partial payments.
You might also benefit from services that offer fast credit repair—so long as you have legitimate issues with your credit report, such as incorrect information or unverifiable debts, reputable credit repair agencies (and they do exist) can be of great help. They may also be able to work with creditors to set up debt repayment plans, reduce interest rates and set up other more favorable terms for you.
Start Seeing Yourself as a Financially Responsible Person:
Your mind and your beliefs about yourself will set the stage for the decisions you make, and you have to start seeing yourself in a different light. If you have been bad with money your whole life, you might have the idea that you will always struggle because you are someone who is “just not good with money”.
But, your financial troubles resulted from bad habits and poor decisions, not some unchangeable aspect of yourself etched into your DNA. You are not destined to a life of financial strife—you can turn things around right now if you just decide you will. A good mindset and a few well placed financial tips will make it easier to make the decisions you need to make to improve your situation and get on the right track.
Featured image courtesy of Flickr – Holly Lay