Manage Your Budget

debt stressHaving an overview of your financial situation and your credit score (which should now also be fixed) it is time to get your debt under control. The list you have made should have told you exactly where your money was going. If you are in debt and struggling to get out of it, you need to stop spending money on unnecessary items. Most ways to cut back on your expenses is pretty commonsense but drastic. A great example is snacks and food. If you eat out a lot, cut that back straight away. Spend more money at the store and less eating out, even for the lunches you eat in the office. Bring in your own lunch and save the money.

If you indulge in alcohol and smoking, its time to stop those things. While everyone works hard and is entitled to a small amount of luxury, you may have to accept that the luxury must be forgotten for a few months or even a few years (seriously) until you debt is under control. Debt will destroy your life, not having a smoke will do the polar opposite. If cutting back on unnecessary items does not bring your outgoings under control then there is more serious issues which require a bigger better game plan. The aim of the game is to make sure that the money coming in covers three things through the month. The first is your necessary bills. These are your living expenses and your debt bills such as rent and credit cards. Do not forget the necessary bills such as electricity etc.

budgetingThe second is your have to bills, such as food and water, general things that you don’t have to pay in a financial sense but without them you will die. The third is the savings, remember when savings is spoken about, this is NOT just talking about a huge amount. Even if you put ten dollars away a month over the year you will have saved over one hundred dollars. Sounds stupid until you really need a hundred dollars next year for that part for your car that just broke down.

Think small to get big, treat your income like the federal budget and manage every cent. If you don’t need to be spending money on something, don’t. Self control is everything when it comes to finances and the reason why most people fail at it.