There’s no question that financial difficulties can cause a lot of stress in our lives. Continually fretting about how you’re going to pay your bills not only makes you anxious, but also places stress on your relationships, your family, and your health. The fact is, stressing over money isn’t going to solve your financial concerns. If you’ve found yourself in a position where you’re battling to make ends meet, here are the best ways to deal with your financial difficulties so you can live a worry-free life again.
Document your monthly expenditures
The first step in addressing your financial concerns is find out exactly where your pain points are. Regardless if you’re dealing with a large credit card debt, you’re trying to increase your retirement savings, or you simply spend too much on dining in restaurants throughout the week, discovering the main causes of your financial troubles will show you which expenditures have to be prioritised so you can get your finances back on track. Get a pen and paper and write down your current monthly costs including debt repayments, food, bills, tuition, transport, and any other items you commonly spend every month.
Cut down on your expenditures
After 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 severed altogether. While your mortgage repayments naturally can’t be decreased, you can possibly lower your food bill by only eating at home and even eliminate other entertainment expenses such as cable TV. It’s critical that you are pragmatic about lowering your expenses. Remember, if you’re dealing with financial difficulties then you have to make sacrifices to resolve them.
Develop a budget
Now that you’ve got your monthly costs documented without the unnecessary spending, you must develop a budget. If you’re not familiar 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 practical: 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 every month by viewing your income and expenses. It’s necessary that you stick your budget. If you feel that it could be too challenging 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 sticking to your budget.
Prioritise your debts
Some debts cause more pain than others, so to ease your financial stress 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 attempt to decrease these kinds of debts as soon as possible. Keep in mind, you still have other fixed debts every month including phone bills and electricity, so these have to be taken into account as well.
Still feeling the heat?
If you’ve reduced your expenditures and made 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 high priced household items that you can do without? Reaching out to family or friends is another helpful way to attempt to address your challenges. Whatever you do to get extra money, never get a personal loan from the bank to repay your existing debt – this will only exacerbate an already stressful situation.
Seek financial assistance
If the above steps haven’t relieved your financial strain, it’s better to seek financial assistance sooner instead of later. Depending on your individual circumstances, there are plenty of alternatives available including debt consolidation loans or debt agreements which can help those in need. Don’t wrestle with your debts for years before getting help, speak with Bankruptcy Experts Frankston on 1300 795 575 or visit our website for additional information: www.bankruptcyexpertsfrankston.com.au