Is It Time To Fix Your Finances?

Financial freedom might be your goal, but most of us are suffering from financial burdens. More and more people rely on credit just to get by. And, of course, there are many essentials in life, like the car and the home, that are unattainable without a loan. As the cost of living continues to increase, there are fewer disposable dollars to enjoy. But at what time do you need to address these issues? When can you tell that it’s no longer manageable?

No Savings

If you’re not putting anything away for a rainy day anymore, something isn’t quite right. This suggests you are stretched to the very limits of your income. An emergency fund to help you cover the cost of any repairs or replacements that are necessary is essential. If you’ve already started dipping into yours, or it is completely depleted, alarm bells should be ringing. If you have no savings to fall back on at all, then times may be proving very tough right now.

Have a look at your income and your budget. Consider asking for a pay rise or promotion. You might also find a second source of income. Your household budget may be trimmed a little. Check your receipts and see if any cuts can be made. Try to reduce your spend on energy bills by checking lights are off and heating or cooling temperatures are adjusted. 

Red Bills

If you regularly receive red reminder letters from your creditors and service providers, then you might be living beyond your means. Struggling to make payments on time can also be a sign that your budgeting isn’t working out too well right now. Cancel any non-essential services like subscription TV packages or mobile phone contracts.

Are you feeling a lot of stress every time you open your mail box? Apprehension and anxiety about demand letters can make you physically and mentally ill. If you’re worried there will be a knock at the door from a debt collector, it is definitely time to take action. It’s worth speaking to an FDCPA attorney if you are receiving a lot of letters or debt collector visitors. If these creditors are bullying you into ill health, you can’t let it continue.

Not Enough Income

Life changes all the time. Sometimes this can bring about a big change in your income. Whether you lose your job, or you’re not in a position to work as much, you must address the shortfall. Take a detailed look at your household budget. Try to trim as many expenses as you possibly can. 

If the lack of income is going to last a while, you might need to consider getting rid of some of the things you have previously considered to be essential. This might include your car, your TV subscriptions, and clothes shopping. Reduce how often you attend the salon, cancel your gym membership, and shop around for cheaper deals on phones and energy. Consider consolidation of your existing credit to see if you can reduce your debts. In the least it might make repaying them more affordable.

When you’ve cut everything back to the very bare essentials, you can focus your energy on finding additional sources of income. This might include selling unwanted items or selling high-spec to be replaced with budget-lines. When you’re back to full earning potential again, you can start to enjoy the finer things once more.

In the meantime, look for opportunities to earn in different ways. Can you teach or write? Both of these things can be done from home using the internet. Perhaps you are quite arty and can create pictures or crafts that can be sold? Can you take on a part time job out of hours to bolster your salary? If you’re at home with your kids, why not consider qualifying as a childminder so you can be paid to care for other children too?

Sacrificing Meals

Beyond the stress of receiving unpleasant debt collection letters comes the need to make sacrifices. We’ve already talked about living more frugally. But if you’re finding it necessary to go without food or heating at all, then you have serious financial problems. It’s important to seek help and advice as soon as possible. Skipping meals and going cold in your own home is not healthy.

It’s not always easy or even possible to live within your means. The cost of living often increases beyond our wages. Each year the belt is tightened until the cracks start to show. Get the debt collectors off your back by seeking help and reduce your stress. Find more ways to save, and find creative ways to boost your income. It will get better if you take the time to fix your finances.