Tips on How to Resolve Your Financial Challenges
There’s no doubt that financial troubles can lead to a lot of stress and anxiety in our lives. Frequently thinking 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, stressing over money isn’t going to cure your financial challenges. If you’ve found yourself in a situation where you’re battling to make ends meet, here are the best ways to deal with your financial issues so you can live a stress-free life again.
Write down your monthly expenses
The first step in dealing with your financial difficulties is determine exactly where your pain points are. Regardless if you’re dealing with a large credit card balance, you’re trying to boost your retirement savings, or you just spend too much on eating in restaurants during the week, discovering the main causes of your financial troubles will reveal to you which expenses must be prioritised so you can get your finances back on track. Grab a pen and paper and document your current monthly costs including food, bills, debt repayments, transport, tuition, and any other items you normally spend every month.
Lower your expenditures
When you’ve got your monthly expenditures in front of you, take a closer look and find which expenses can be lowered and which can be eliminated altogether. Even though your mortgage repayments obviously can’t be reduced, you can probably decrease your food bill by only eating at home and even remove other entertainment expenses such as cable TV. It’s necessary that you are pragmatic about cutting down your expenses. Bear in mind, if you’re trying to address financial issues then you must make sacrifices to resolve them.
Put together a budget
Now that you’ve got your monthly expenses jotted down without the unnecessary spending, you need to develop a budget. If you’re unfamiliar with creating a budget, there are lots of terrific apps you can download on your mobile phone. Personally, I’ve found the Budget Planning app from ASIC to be very reliable: https://www.moneysmart.gov.au/tools-and-resources/calculators-and-apps/budget-planner.
This will enable you to determine how much money you have left each month by viewing your income and expenses. It’s necessary that you stick your budget. If you think that it could be 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 distress than others, so to lighten your financial strain as best as possible, try 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 aim to diminish these types of debts as quickly as possible. Keep in mind, you still have other fixed debts every month such as phone bills and electricity, so these need to be factored in too.
Still feeling the heat?
If you’ve lowered your expenditures and created a budget but still find that there’s not enough money to repay all your debts, you’ll have to find other income streams. 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 reliable way to attempt to resolve your troubles. 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 advice
If the above steps haven’t relieved your financial stress, it’s better to seek financial assistance sooner rather than later. Depending on your individual situation, there are lots of solutions available like debt consolidation loans or debt agreements which can assist those in need. Don’t wrestle with your debts for years before getting help, speak to Bankruptcy Experts Melbourne on 1300 795 575 or visit our website for more information: www.bankruptcyexpertsmelbourne.com.au