There’s no question that financial complications can trigger a lot of stress in our lives. Frequently fretting 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 situation where you’re struggling to make ends meet, here are the best ways to address your financial complications so you can live a stress-free life again.
List your monthly expenses
The first step in tackling your financial complications is ascertain 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 out throughout the week, discovering the main causes of your financial problems will show you which expenditures need to be prioritised so you can get your finances back on course. Get a pen and paper and jot down your current monthly expenditures including food, bills, debt repayments, transport, tuition, and any other items you usually spend each month.
Cut down on your expenses
Once you’ve got your monthly expenditures in front of you, take a closer look and find which expenses can be minimised and which can be cut out altogether. Although your mortgage repayments certainly can’t be lowered, you can likely reduce your food bill by only eating at home and even do away with other entertainment expenses like cable TV. It’s pivotal that you are pragmatic about lowering your expenses. Bear in mind, if you’re trying to address financial issues then you need to make sacrifices to resolve them.
Develop a budget
Now that you’ve got your monthly costs written down without the unnecessary spending, you need to create a budget. If you’re not familiar with creating a budget, there are a number of fantastic 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 necessary 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 following your budget.
Prioritise your debts
Some debts cause more distress than others, so to relieve your financial stress 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 reduce 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 should be taken into account as well.
Still feeling the heat?
If you’ve cut down your expenditures and created a budget but still find that there’s not enough money to pay off all your debts, you’ll have to find other income sources. 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 practical way to try to deal with your problems. 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 pressure, it’s better to seek financial advice sooner instead of later. Depending on your individual situation, there are numerous solutions available such as debt consolidation loans or debt agreements which can help those in need. Don’t wrestle with your debts for years before seeking assistance, phone Bankruptcy Experts Geraldton on 1300 795 575 or visit our website for additional information: www.bankruptcyexpertsgeraldton.com.au