Tips on How to Address Your Financial Issues
There’s no doubt that financial difficulties can bring about a lot of stress in our lives. Continually 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 well-being. The fact is, stressing over money isn’t going to solve your financial issues. If you’ve found yourself in a situation where you’re battling to make ends meet, here are the best ways to resolve your financial difficulties so you can live a stress-free life again.
Document your monthly expenses
The first step in resolving your financial complications is ascertain exactly where your pain points are. Whether you’re dealing with a large credit card debt, you’re attempting to increase your retirement savings, or you simply spend too much on dining in restaurants during the week, recognising the main causes of your financial troubles will show you which expenses need to 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 commonly spend every month.
Lower your expenses
When you’ve got your monthly expenditures in front of you, take a closer look and see which expenses can be decreased and which can be eliminated altogether. Although your mortgage repayments obviously can’t be reduced, you can likely reduce your food bill by only eating at home and even remove other entertainment expenses like cable television. It’s necessary that you are pragmatic about decreasing your expenses. Bear in mind, if you’re trying to overcome financial problems then you must make sacrifices to resolve them.
Construct a budget
Now that you’ve got your monthly expenditures documented without the unnecessary spending, you need to create a budget. If you’re not familiar with creating a budget, there are loads of fantastic 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 ascertain how much money you have left each month by looking at your income and expenses. It’s imperative that you stick your budget. If you think that it could be too challenging 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 ease your financial burden as best as possible, aim to decrease your biggest 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 aim to diminish these kinds of debts as quickly as possible. Bear in mind, you still have other fixed debts each month including phone bills and electricity, so these should be taken into account as well.
Still feeling the heat?
If you’ve cut down your expenses and constructed a budget but still find that there’s not enough money to repay 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 reliable way to try to resolve your troubles. Whatever you do to get additional money, never get a personal loan from the bank to repay your existing debt – this will only worsen an already stressful situation.
Seek financial assistance
If the above steps haven’t relieved your financial stress, it’s better to seek financial advice sooner rather than later. Depending on your individual circumstances, there are a number of choices available such as debt consolidation loans or debt agreements which can help those in need. Don’t wrestle with your debts for years before getting assistance, reach out to Bankruptcy Experts Joondalup on 1300 795 575 or visit our website for further information: www.bankruptcyexpertsjoondalup.com.au