Tips to Put into Action When Debt is Causing You Financial Stress
If money problems are keeping you up at night, you are likely feeling the effects of financial stress.
Unfortunately, handling finances is not something that you are taught in high school. Instead, it is something that you usually have to learn on your own when you get out into the world. As a result, it is easy to make some serious mistakes.
Before you know it, you may be drowning under a pile of bills, feeling like you'll never get back to the top. Financial stress can get better, as finances are something that you can learn how to handle.
Here are some things that you need to do to get started:
1. Stop Believing That You Cannot Ever Get Out of Debt
Stop Listening to Others
Constant worry and doubt isn't going to improve your situation. One of the best ways to stop this kind of thinking is to ignore what others are telling you. Many will tell you that it's normal to be in debt, and that everyone else is. The truth is that not everyone is, and you can be one of those people.
2. Sit Down and Figure Things Out
Determine where your money is going every month
Make a list of all your expenses - Some of these expenses change very little from month to month, and you pay them on a regular schedule. Examples are mortgage or rent payments, car payments, retirement or education savings investments, and so on. Other expenses fluctuate more from one month to the next, such as clothing or entertainment costs. And still, other expenses only need be paid once or twice per year, such as car or house insurance. Determine what your total net income is - Then figure out if you are spending more than you make each month. It is recommended that you track this carefully for several months. Keep all your receipts, and start to figure out where your money is being spent. You may be surprised to learn that you are spending several hundred dollars every month on dining out alone.
Determine what can be eliminated from the expense list by asking yourself these questions
What do I need, and what do I want? - Needs are those things that you absolutely need to live – shelter, food, clothing, etc. However, you still have to be wise. For example, do you really need another pair of sandals when you already have nine other pairs in the closet? Of course not! Wants are the extras in life that we don't need to survive, but make our life more enjoyable and fun. Although you may have a television right now (even though it's not a need), you definitely don't need a big-screen one too.
What can I get rid of? - Although you may be paying for cable television, perhaps you can do without it until you get your expenses under control. That can be one less bill every month. Another expense that you may be able to eliminate is purchasing your lunch at work every day. This can get expensive, and quickly adds up.
In conclusion, once you start to believe that you can change your financial situation, and start taking steps to make that happen, your financial stress and burden can start to decrease. By starting with the steps above, then you can move on to specific methods of reducing your debt, which will further decrease your stress.
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