Handle Your Own Personal Financial Situation
If the topic of money is one that overwhelms you or makes you want to turn and run screaming, you need to get a handle on your personal financial situation. However, this does not have to take a feat of superhuman willpower or a total lifestyle overhaul in one week. Break down your journey into the steps listed in the following paragraphs.
First, know where you are. List out all of your debts, how much you owe on them, what the interest rates are and when the minimum payments are due each month. Count up your savings and how much money is in your wallet. Chart your income, especially if it fluctuates. Stack up your bills and lay them out on a calendar.
Having done all that, start tracking your expenses. This can be real easy if you pay for everything electronically. If you pay for anything in cash, get a receipt to add to your print out. The longer a period of time you have complete data for, the more accurate a picture you can get of where your money is going.
As you sift through all this data, remember that you are not looking for a magic bullet that solves all of your problems. Rather, you are looking for the smallest possible things that you can snip out or replace with something cheaper. Could a coffeemaker replace your morning trip through the Starbucks drive-through? If you love seeing a movie every weekend, could you start going to the second run theater? Can you economize one meal out a week or be a little more mindful in grocery shopping? Look for anyplace where you can cut a few dollars, without drastically impacting your immediate lifestyle.
Also consider things that you can do to boost your income a little bit. Are there tax breaks you are not taking advantage of? Do you have things in your closets, attic, garage or basement that you could sell online or through a yard sale? Do you have any skills that you could contract or freelance with? Do you have time to maybe take paid surveys online?
Between tiny cutbacks in your expenses and small boosts to your income, you can start creating a gap of money between your income and outflow that you can use to increase your savings. Apply this money towards high interest debts or the building up of your emergency savings fund.
Take Charge of Your Financial Situation
Once you have made token cosmetic alterations to your budget and lifestyle, you should be far less intimidated by what is involved and maybe even emboldened to tackle some larger changes. Look at your major expenses and see if you can make changes that will still suit you. Could a cheaper car still get you around? Can you vacation closer or cheaper? Always be willing to consider refinancing anything you owe money on and always shop around for new car insurance at renewal time.
With some simple steps to start off with, you can easily take charge of your financial situation. Start small and then gradually build into something bigger, using the outline in this article.
