There’s no doubt that financial troubles can trigger a lot of anxiety in our lives. Repeatedly worrying about how you’re going to pay your bills not only makes you anxious, but also puts stress on your relationships, your family, and your health. The fact is, worrying about money isn’t going to cure 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 challenges so you can live a worry-free life again.
Write down your monthly expenditures
The first step in overcoming your financial problems is uncover 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 throughout the week, recognising the main causes of your financial troubles will reveal to you which expenditures should be prioritised so you can get your finances back on track. Grab a pen and paper and document your current monthly expenses including debt repayments, food, bills, tuition, transport, and any other items you commonly spend every month.
Decrease your expenditures
Once you’ve got your monthly expenditures in front of you, take a closer look and examine which expenses can be minimised and which can be removed altogether. Even though your mortgage repayments obviously can’t be decreased, you can possibly lower your food bill by only eating at home and even get rid of other entertainment expenses like cable TV. It’s integral that you are pragmatic about reducing your expenses. Keep in mind, if you’re trying to overcome financial problems then you must make sacrifices to resolve them.
Develop a budget
Now that you’ve got your monthly costs jotted down without the unnecessary spending, you must develop a budget. If you’re unfamiliar with developing a budget, there are plenty of terrific apps you can download on your smartphone. 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 figure out how much money you have left each month by examining your income and expenses. It’s imperative that you stick your budget. If you sense that it could be 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 following your budget.
Prioritise your debts
Some debts cause more distress than others, so to relieve 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 much better about yourself. Only paying the minimum repayments on your credit card bill can sometimes take years to pay off, so aim to reduce these kinds of debts as soon as possible. Bear in mind, you still have other fixed debts every month like 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 created a budget but still find that there’s not enough money to repay all your debts, you’ll need to find other income sources. 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 reliable way to attempt to address your concerns. Whatever you do to get additional money, never get a personal loan from the bank to repay your existing debt – this will only compound an already stressful situation.
Seek financial advice
If the above steps haven’t relieved your financial strain, it’s better to seek financial guidance sooner instead of later. Depending on your individual situation, there are lots of choices available including debt consolidation loans or debt agreements which can help those in need. Don’t wrestle with your debts for years before seeking assistance, speak with Bankruptcy Experts Darwin on 1300 795 575 or visit our website for further information: www.bankruptcyexpertsdarwin.com.au