In a Sticky Situation With Money? Here’s What You Need to Do
There’s nothing quite as stressful as needing money for an emergency, event or occasion and simply not having it. We can all feel the pinch from time to time, but if you’re constantly struggling for money it’s time to make some changes. Here’s how you can go about it.
Get out of debt
If you’re already in debt, any other financial issues you come up against are going to be a huge problem. When you already owe money out, the last thing you need is more debt adding to the pile and getting you further and further into hot water. It’s so important to get out of debt, if you owe money to creditors then you should make it your mission to pay it down as quickly as possible. Tighten the belt, get rid of all of your luxuries. Sell what you don’t need, take on extra shifts at work, whatever it takes. It’s not a fun way to live for a while, but the sooner it’s out of the way the better- then you’re on the path to a much brighter financial future. If your debt has spiraled so much that you’ll never realistically be able to pay it off then you need to consider your options. IVAs, debt management plans or bankruptcy could be the way to go depending on your circumstances. Seek debt advice, don’t bury your head in the sand. Add up everything you owe so you know exactly what situation you’re in, and then take steps to put things right.
Once you’re out of debt, your next step is to save money. There’s no point trying to save while you’re in debt because you’re getting charged interest every month it makes much more sense to use any money you have to pay down balances. Again, tighten the belt, make cutbacks and make saving money a priority. This could be five dollars or one hundred dollars a week depending on your situation, but whatever you can- put away. That way you have a ‘buffer’- if something goes wrong in life and you need cash fast, you know you can put it right. It can take a lot of stress out of an already stressful situation and is something everyone should aim to do. One way to make it easy for yourself is to set up a savings account with your bank if you have online banking every time you get paid simply transfer some over. Otherwise, something as simple as setting up a change jar and throwing loose change in at the end of each day can really add up.
One way you can plan for future problems is by getting insured. It could be health, dental, home, pet, boiler insurance- whatever you think you’ll need and would leave you out of pocket if the worst were to happen. Work insurance costs into your monthly budget, while your monthly outgoings will go up a little it can prevent you ending up thousands in debt later on. Always do your research with insurance, read the small print to make sure you know exactly what you’re covered against. It doesn’t always make sense to go with the cheapest option.
Use credit in the right way
Perhaps you’ve not had enough time to save, or something has come up and you simply can’t afford to pay for it. If so, you might need to utilize credit but do it wisely. Using Amistad bail bonds to bail a loved one out of jail, for example, might be necessary. If your car breaks down and you absolutely need one to get to work then again, it’s worth taking credit out for. But don’t be tempted to take out loans and credit cards to pay for luxuries, it will end up in a downward spiral of debt. Always check the interest rates and be aware of the repayment to ensure this is definitely something you can work within your budget.
Stick to a budget
Speaking of budget, this is something that all of us should have. It doesn’t matter if you earn a little money or a lot, being in control of it and knowing you can afford all of your outgoings is so important. Use a budgeting app, a calendar, or even just an old fashioned notepad and pen to work out what needs to be paid and when. If there are any areas where you’re overspending- socialising and groceries are often big offenders- then look for ways you can cut down. Perhaps you could have nights in instead of nights out to save money- if you host a ‘potluck’ dinner party with friends it works out cheaply as everyone brings a dish. Maybe you could make your own lunches for work instead of buying them every day, and cut back on the coffee shop coffees. As long as you’re not in debt and are comfortably saving each month you don’t need to be too strict with yourself, but it’s always worth keeping tabs on what you’re spending. As let’s face it, money is hard earned but easily spent.
Start a side hustle to earn more money
It’s easy to say ‘get a new job’ or ‘gain a promotion’ as a way of earning more money, but it’s a lot more difficult in practice. Maybe you’re in a job that offers no progression but can’t change right now as you don’t have the qualifications. It could be a case that you will eventually move up in your job but it will take a long time. So instead of trying to earn more money here, it can be much quicker and easier to set up a side hustle. Run an online business buying products wholesale and selling for a profit. Utilise a craft you have- baking, sewing, gardening to produce products to sell. Monetise your blog, or do some freelance work on a site like Upwork. You can work in your spare time around other commitments, and it’s from home meaning there’s no travel time or costs to work into it. Whether you need extra money to save, get out of debt or just make life that bit easier it’s something well worth doing.