Are you drowning in monthly bills? Are you living paycheck to paycheck? Do you wonder if you will ever own a home or be able to take that vacation to the Bahamas? Is your credit score so poor that you can’t even finance a clunker car or move into a better apartment?
If this is you, there is hope and there is help. You can prevent your financial burdens from becoming overwhelming by deciding today to take control of your life. There are a few simple ways to start on your path to financial freedom and onto the life you want.
Face the Debt Head On
First of all, you need to face the debt head on. Be honest with yourself. Don’t overlook any of the debt you’ve incurred even if you have neglected to make payments on it and it’s in the hands of a creditor. You need to know exactly where you stand. If there are too many bills, and creditors are breathing down your neck, it may be time to seek credit help to resolve some of those more complex issues.
With all of your bills laid out before you, it’s time to set forth a plan. One of the best ways to do this is to use a snowball debt elimination calculator. With a debt elimination calculator, it’s possible to see just how long it will take to pay off all of your debt. With snowball debt elimination calculators, debts are listed from smallest to largest and once the smallest debt is paid off, the payment amount previously being used to pay the smaller debt is applied to the next smallest debt. The rollover process continues until all of the debt is gone. Another debt elimination process, the avalanche method, involves paying off the highest interest debt first instead of the smallest debt until the debt is gone.
Consolidating debt is another great way to simplify and conquer your financial burdens. Transferring higher interest credit card balances to lower or 0% interest credit cards can help you pay off your debt sooner since more of your available funds will go toward debt instead of interest; however, if you transfer the balances, it doesn’t do you any good if you continue to use your cards. From here on out, you’ll be living a credit card free life. You’ll need to stop creating debt and commit to paying more than the minimum due each month to make a dent in the debt, preferably at least as much as you were paying before consolidating, and hopefully, much more.
Follow a Budget
Following a budget is a must if you want to feel the relief that comes from financial freedom. As you follow the advice from credit repair companies and actively try to eliminate or consolidate the debt, a budget will help you stay on track, keep you accountable, and prevent greater debt from accruing. To do this, you’ll need to differentiate wants from needs and be willing to wait to buy things you want but don’t necessarily need. But even though you may have to give some things up for a while, sticking to your budget and practicing self-restraint will bring you peace of mind as you see your financial burdens lifting.
Along with your general budget, you should be tracking individual expenditures as a way to be accountable. You may wonder why you need to keep track of every little thing you spend. Why isn’t just sticking to the budgeted amount enough? Overall, it is. But if you take your budget a step further and assess where all of the budgeted money has gone, you will most likely find even more places to cut back, freeing up additional resources. For example, how much of your food budget goes toward fast food? Going out to lunch may fit into your budgeted amount, but you could save a couple hundred dollars a month by bringing a lunch to work instead. And two hundred extra dollars a month could relieve a lot of financial stress!
Saving money may seem impossible if you’re living paycheck to paycheck, trying to eliminate debt, and living within a budget, but in reality, it’s a habit you need to start if you truly want to take control of your finances and stop feeling overwhelmed by financial burdens. Remember that money you just saved by bringing lunch to work instead of buying fast food? How about putting some of that into a savings account? Even $25 is a start. Starting small is fine. The important thing is that you make it a habit and let your money begin to grow.
Taking control of your finances, getting out of debt, sticking to a budget, cutting back where you can, and learning to save will free you from financial burdens and give you back your peace of mind. Take control of your finances--don’t let your finances take control of you!
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