There’s no question that financial problems can inflict a lot of stress and anxiety in our lives. Constantly fretting about how you’re going to pay your bills not only makes you apprehensive, but also places stress on your relationships, your family, and your well-being. The fact is, worrying about money isn’t going to solve your financial troubles. If you’ve found yourself in a situation where you’re straining to make ends meet, here are the best ways to resolve your financial complications so you can live a worry-free life again.
List your monthly expenditures
The first step in tackling your financial issues is find out exactly where your pain points are. Whether you’re dealing with a large credit card debt, you’re trying to increase your retirement savings, or you merely spend too much on eating in restaurants during the week, discovering the main causes of your financial problems will reveal to you which expenses should be prioritised so you can get your finances back on course. Get a pen and paper and write down your current monthly expenditures including food, bills, debt repayments, transport, tuition, and any other items you normally spend every month.
Decrease your expenses
Once you’ve got your monthly expenditures in front of you, take a closer look and see which expenses can be minimised and which can be removed altogether. Even though your mortgage repayments obviously 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 TV. It’s necessary that you are pragmatic about decreasing your expenses. Always remember, if you’re trying to address financial difficulties then you have to make sacrifices to resolve them.
Develop a budget
Now that you’ve got your monthly expenditures written down without the unnecessary spending, you must construct a budget. If you’re unfamiliar with creating a budget, there are loads of wonderful 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 establish how much money you have left each month by viewing your income and expenses. It’s crucial 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 perhaps 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 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 try to diminish these types of debts as quickly as possible. Always remember, you still have other fixed debts each month including phone bills and electricity, so these have to be taken into account as well.
Still feeling the heat?
If you’ve cut back on your expenditures and constructed a budget but still find that there’s not enough money to settle all your debts, you’ll need to find other income streams. 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 try to deal with your challenges. Whatever you do to get additional money, never get a personal loan from the bank to repay your existing debt – this will only magnify an already stressful situation.
Seek financial guidance
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 numerous choices available such as debt consolidation loans or debt agreements which can help those in need. Don’t fight your debts for years before getting help, talk to Bankruptcy Experts Mackay on 1300 795 575 or visit our website for additional information: www.bankruptcyexpertsmackay.com.au