Are you struggling financially? If so, don’t be ashamed – you’re not the only one. A number of people are drowning in debt and they are finding it difficult to manage. Even more worrying is the fact that people with money problems are less likely to be prepared for a financial set back like divorce, unemployment, or in the tragic case of a death in the family.
Like many others, you might find yourself struggling financially and unable to even set aside money into a savings account for a rainy day. If this sounds like you, then take a look at these five tips that will help you get back on track.
1. Consider Debt Consolidation
It’s not always easy to ask for help, but if you contact a not-for-profit credit counselling agency, they can set you up with a debt consolidation program that can start you on a path towards a debt-free life. How does debt consolidation work when done under a program provided by a credit counselling agency?
Basically, a Credit Counsellor will work with you to gather all of your unsecured debts into one single lower monthly payment with reduced or stopped interest fees. That way you only have to worry about a single payment each month instead of several.
2. Understand Your Finances
Money can be confusing and overwhelming, especially if you’re not the strongest at math and numbers. Thankfully, if you decide to go with a Credit Counsellor they will educate you on the ins and outs of your financial situation, and will even teach you valuable money management lessons.
If you don’t have one, it’s still important to set aside some time to go over your financials and assess your situation. From there, you can begin to make positive changes and set realistic financial goals.
3. Set a Budget
It’s so vital to track your income and spending when trying to improve your financial situation. Use a handy free budgeting app like Mint or an Excel spreadsheet to list out how much money you have coming in and how much you have going out. With it all laid out in front of you you’ll be able to determine where you’re over spending, how much you should actually be spending, and where you can cut costs.
4. Create an Emergency Fund
Life can change for the better or worse at any moment, which is why you need emergency savings. It’s advised that you work towards building up 3 to 6 months of your expenses in a savings account that you easily have access to in the event of an emergency. If this isn’t doable, aim to have at least $1000 stashed away in emergency funds.
5. Increase Your Income
Sometimes, the reality is that you can only cut your expenses so much. That means that it’s time to earn some extra cash where you can; whether you take on extra hours at work, a new part-time job, or perhaps do some extra odd-jobs here and there.
You can even earn some free money with cash-back apps like Checkout 51 and Rakuten; both will help you earn extra cash when shopping at a number of different retailers.
Keep these tips in mind and you should be well on your way to improving your financial situation!