There’s no question that financial difficulties can create a lot of stress and anxiety in our lives. Incessantly fretting about how you’re going to pay your bills not only makes you apprehensive, but also puts stress on your relationships, your family, and your health. The fact is, stressing over money isn’t going to cure your financial difficulties. If you’ve found yourself in a position where you’re straining to make ends meet, here are the best ways to deal with your financial challenges so you can live a worry-free life again.
List your monthly costs
The first step in addressing your financial problems is discover exactly where your pain points are. Whether or not you’re dealing with a large credit card debt, you’re trying to enhance your retirement savings, or you simply spend too much on eating out during 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 course. Get a pen and paper and document your current monthly costs including debt repayments, food, bills, tuition, transport, and any other items you generally spend each month.
Lower your expenditures
When you’ve got your monthly expenses in front of you, take a closer look and find which expenses can be decreased and which can be severed altogether. Although your mortgage repayments certainly can’t be decreased, you can most likely decrease your food bill by only eating at home and even get rid of other entertainment expenses such as cable television. It’s crucial that you are pragmatic about decreasing your expenses. Always remember, if you’re dealing with financial problems then you have to make sacrifices to resolve them.
Create a budget
Now that you’ve got your monthly expenditures jotted down without the unnecessary spending, you must develop a budget. If you’re unfamiliar with making a budget, there are plenty of wonderful apps you can download on your mobile phone. Personally, I’ve found the Budget Planning app from ASIC to be very valuable: 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 paramount that you stick your budget. If you think that it could be too hard 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 sticking to your budget.
Prioritise your debts
Some debts cause more distress than others, so to lighten your financial pressure as best as possible, aim to decrease your largest 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 lower these types of debts as quickly as possible. Don’t forget, you still have other fixed debts every month such as phone bills and electricity, so these should be factored in too.
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 need to find other income streams. Are you able to work a second job? Can you sell any expensive household items that you can do without? Reaching out to family and friends is another helpful way to try to address your issues. Whatever you do to get additional 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 guidance
If the above steps haven’t relieved your financial strain, it’s better to seek financial assistance sooner rather than later. Depending on your individual situation, there are a number of options available such as debt consolidation loans or debt agreements which can assist those in need. Don’t wrestle with your debts for years before seeking assistance, speak to Gold Coast Bankruptcy Centre on 1300 795 575 or visit our website for further information: www.goldcoastbankruptcycentre.com.au