Changing your attitude to think about your money in terms of what you do have as
opposed to what you don’t is the key starting point to getting on top of your finances.
If you have a job but are living beyond your means i.e. always broke, this is the
first thing you must face, you are spending more than you earn, if you want to alleviate
all the stress and worry that goes alongside this kind of lifestyle choice.
Committing yourself to regular monthly payments for stuff is the first mistake we
make, eroding all your personal choices because before you know it all your money
is already spent, accounted for before you’ve even been paid. This kind of behaviour
and thinking also keeps many of us trapped in jobs we hate just to get by………….not
Divide your life into these categories
Now take out your last six months bank statements. If you don’t keep them your bank
will happily sent you copies or sign up for free online banking and access your
account over the internet. You must go through every transaction month by month
allocating each amount to one of the four categories.
The truth is getting out of a financial hole cannot be done overnight. The debts
and behaviours that have caused the problem have happened over time and will take
time to rectify. By gradually taking control of the spending choices still within
your control and creating some financial breathing room your patterns/behaviours
will change and your stress/worry levels will decrease.
Now you have it in black and white your lists will look something like this.
Balancing your books is brutal but can be done by taking decisive action. Remember
why you are doing this; for a better, happier and less stressful life. The truth
is, you must not spend money you haven’t got if you really want to enjoy your life.
It’s as simple as that so the questions to ask yourself now are what to do next?
and how to face and embrace the changes?
You have to live somewhere and very few of us are lucky enough to live rent free
so this expense must come out first every time and there’s not very much you can
do about that. If you own your house i.e. pay a mortgage, you could rent it out
and find somewhere cheaper for yourself/your family until you get back on your feet
or think about renting out your spare room to increase your monthly income.
You’ve got to pay your loans, monthly commitments/subscriptions and credit cards
and our best advise is to cut this list back totally wherever you can in the short
term to free up monthly income in the medium to longer term. Cable TV and your home
landline and broadband must go. Get a pay as you go dongle instead if you really
need internet access at home. It may be hard at first but is not for ever. Remembering
why you are doing this is the key to remaining strong and focused.
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