There’s no question that financial complications can bring about a lot of stress in our lives. Endlessly worrying about how you’re going to pay your bills not only makes you distressed, but also places stress on your relationships, your family, and your health. The fact is, worrying about money isn’t going to solve your financial issues. If you’ve found yourself in a position where you’re straining to make ends meet, here are the best ways to address your financial difficulties so you can live a worry-free life again.
List your monthly costs
The first step in taking care of your financial issues is figure out exactly where your pain points are. Whether you’re dealing with a large credit card debt, you’re trying to boost your retirement savings, or you simply spend too much on dining in restaurants throughout the week, recognising the main causes of your financial concerns will reveal to you which expenses need to be prioritised so you can get your finances back on track. Grab a pen and paper and write down your current monthly expenses including food, bills, debt repayments, transport, tuition, and any other items you regularly spend each month.
Decrease your expenditures
After you’ve got your monthly expenses in front of you, take a closer look and examine which expenses can be minimised and which can be cut out altogether. Even though your mortgage repayments naturally can’t be reduced, you can likely reduce your food bill by only eating at home and even get rid of other entertainment expenses like cable television. It’s vital that you are pragmatic about reducing your expenses. Bear in mind, if you’re dealing with financial problems then you must make sacrifices to resolve them.
Construct a budget
Now that you’ve got your monthly costs documented without the unnecessary spending, you must construct a budget. If you’re unfamiliar with developing a budget, there are a number of fantastic apps you can download on your mobile phone. Personally, I’ve found the Budget Planning app from ASIC to be very helpful: 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 every month by examining your income and expenses. It’s imperative 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 maybe 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 lighten your financial burden as best as possible, try to decrease 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 aim to diminish these kinds of debts as soon as possible. Bear in mind, you still have other fixed debts each month like phone bills and electricity, so these should be taken into account as well.
Still feeling the heat?
If you’ve reduced your expenditures and created 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 costly household items that you can do without? Reaching out to family or friends is another reliable way to attempt to resolve your troubles. Whatever you do to get extra money, never get a personal loan from the bank to pay off 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 advice sooner instead of later. Depending on your individual situation, there are numerous options available like debt consolidation loans or debt agreements which can help those in need. Don’t wrestle with your debts for years before getting assistance, phone Bankruptcy Experts Maitland on 1300 795 575 or visit our website for more information: www.bankruptcyexpertsmaitland.com.au