Finance Fears: What to Do When You’re in over Your Head
Money worries affect many people, but sometimes, things go especially awry. In times of extreme financial hardship, it can feel as though there is no way out. Well, there are ways out, but they require planning and proper foresight. Here are four ways to help yourself get out of financial troubles.
Audit your Finances
In order to take proper control of your financial situation and alleviate your money worries you need to have a complete understanding of everything pertaining to your money, from what your expenses are to how much you take in.
Using a spreadsheet program or even just paper and pen, estimate how much you take in on a monthly basis, then calculate how much your expenses are. If your expenses are outweighing your income severely, then you know it’s time to reconsider some of the things you spend money on.
Start a Budget
Getting out of financial trouble means changing some of your spending habits. While even the most discretionary spenders find themselves in money trouble, those in deep debt can lay some of the blame on themselves for not thinking before they spend.
Assess all your expenses and determine which ones could be cut. For instance, maybe there’s an unused gym membership that’s burning a hole in your pocket. Additionally, you might be spending several hundred dollars on going out to eat every month when you could be making meals at home.
Attack Methodically
You can’t just say you’ll get out of financial trouble and be golden the next day. Short of winning the lottery, you need to make a plan. Start with the most pressing issues. Any outstanding debts, such as credit card bills or car payments, should be handled first.
When you find your head somewhat above water, you should keep up the habits that brought you there in the first place. Don’t feel discouraged if you’re still in debt months after your journey begins. The purpose of these practices is to teach good habits that will stick with you.
File for Bankruptcy
This might sound a bit extreme, and it’s by no means the first or only thing you should do. However, sometimes our financial situation gets so cumbersome that we have no choice but to declare bankruptcy.
Be sure to take on the counsel of a bankruptcy attorney like the Law Office of Barbara B. Braziel or someone similar and understand that while filing for bankruptcy will provide some debt relief, it will have a very negative effect on your credit rating.
Money Worries
When dealing with money problems, there’s no sense in suffering in silence. By starting today and drafting a budget or eliminating unnecessary expenses, you can get yourself on the road towards financial recovery.
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Category: Family Finances
