There’s no question that financial troubles can trigger a lot of stress and anxiety in our lives. Constantly 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 well-being. The fact is, worrying about money isn’t going to solve your financial troubles. 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 problems so you can live a stress-free life again.
List your monthly expenses
The first step in overcoming your financial complications is discover 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 during the week, pinpointing the main causes of your financial woes will reveal to you which expenses have to be prioritised so you can get your finances back on course. Get a pen and paper and document your current monthly expenses including bills, debt repayments, food, tuition, transport, and any other items you regularly spend every month.
Lower your expenditures
After you’ve got your monthly expenditures in front of you, take a closer look and examine which expenses can be reduced and which can be severed altogether. Although your mortgage repayments certainly can’t be lowered, you can possibly lower your food bill by only eating at home and even do away with other entertainment expenses such as cable television. It’s imperative that you are pragmatic about lowering your expenses. Don’t forget, if you’re dealing with financial difficulties then you must make sacrifices to resolve them.
Construct a budget
Now that you’ve got your monthly costs written down without the unnecessary spending, you must create a budget. If you’re unfamiliar with creating a budget, there are plenty of terrific apps you can download on your mobile phone. 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 identify how much money you have left every month by reviewing your income and expenses. It’s paramount that you stick your budget. If you think that it could be too challenging 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 sticking to your budget.
Prioritise your debts
Some debts cause more distress than others, so to relieve your financial burden as best as possible, try to decrease your largest 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 try to lower these types of debts as quickly as possible. Always remember, you still have other fixed debts every month like phone bills and electricity, so these should be taken into account as well.
Still feeling the heat?
If you’ve lowered your expenditures and constructed 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 costly household items that you can do without? Reaching out to family or friends is another practical way to try to resolve your issues. Whatever you do to get additional money, never get a personal loan from the bank to settle your existing debt – this will only intensify an already stressful situation.
Seek financial advice
If the above steps haven’t relieved your financial stress, it’s better to seek financial advice sooner rather than later. Depending on your individual circumstances, there are numerous choices available such as debt consolidation loans or debt agreements which can assist those in need. Don’t fight your debts for years before getting guidance, talk to Bankruptcy Experts Coffs Harbour on 1300 795 575 or visit our website for more information: www.bankruptcyexpertscoffsharbour.com.au