Tips on How to Resolve Your Financial Challenges
There’s no question that financial concerns can lead to a lot of stress and anxiety in our lives. Frequently worrying 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, worrying about money isn’t going to cure your financial problems. If you’ve found yourself in a position where you’re battling to make ends meet, here are the best ways to resolve your financial troubles so you can live a stress-free life again.
Document your monthly expenditures
The first step in managing your financial issues is find out exactly where your pain points are. Regardless if you’re dealing with a large credit card balance, you’re trying to increase your retirement savings, or you just spend too much on eating out throughout the week, discovering the main causes of your financial problems will show you which expenditures have to be prioritised so you can get your finances back on track. Grab a pen and paper and document your current monthly expenses including debt repayments, food, bills, tuition, transport, and any other items you normally spend every month.
Lower your expenses
Once you’ve got your monthly expenses in front of you, take a closer look and examine which expenses can be lowered and which can be removed altogether. While your mortgage repayments clearly can’t be lowered, you can most likely lower your food bill by only eating at home and even eliminate other entertainment expenses such as cable television. It’s vital that you are pragmatic about minimising your expenses. Remember, if you’re trying to address financial complications then you must make sacrifices to resolve them.
Create a budget
Now that you’ve got your monthly expenditures jotted down without the unnecessary spending, you need to create a budget. If you’re unfamiliar with making a budget, there are a number of wonderful apps you can download on your smartphone. 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 identify how much money you have left each month by examining your income and expenses. It’s paramount that you stick your budget. If you think that it could be too hard to do this, add a miscellaneous item to your budget to give you some room to breathe, or even a motivation item to reward yourself at the end of the month for following your budget.
Prioritise your debts
Some debts cause more suffering than others, so to alleviate your financial strain 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 decrease these types of debts as quickly as possible. Remember, you still have other fixed debts every month such as phone bills and electricity, so these have to be accounted for as well.
Still feeling the heat?
If you’ve cut down your expenditures and created a budget but still find that there’s not enough money to pay off all your debts, you’ll need to find other income sources. Are you able to work a second job? Can you sell any costly household items that you can do without? Reaching out to family and friends is another reliable way to attempt to deal with your difficulties. Whatever you do to get additional money, never get a personal loan from the bank to settle your existing debt – this will only worsen an already stressful situation.
Seek financial guidance
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 situation, there are plenty of solutions available like debt consolidation loans or debt agreements which can help those in need. Don’t fight your debts for years before seeking guidance, speak with Bankruptcy Experts Tamworth on 1300 795 575 or visit our website for more information: www.bankruptcyexpertstamworth.com.au