Are you feeling the pinch with your finances and starting to find that your credit card bill just seems to be getting bigger and bigger?  If you’re struggling to keep yourself afloat while at the same time pay off student loans, mortgages, credit card bills and so on – it is high time that you took a long hard look at how you manage your finances.

Just like most things, the best place to start is at the beginning: Your income and expenditure.


Balancing Income and Expenditure

Start by noting down how much you make per month.  If you make a steady wage then that should be what you put down (after tax), or if your wage varies based on hours or commissions, then take a 6 month average and use that instead.

Once you’ve done that – start listing everything you spend money on.  At this point you should separate your normal monthly expenditure from your debt payments, but make sure they’re all listed.

Now think about what you can reduce from your expenditure.  Are you eating out a lot?  Do you tend to buy a lot of things on impulse?  Are you spending a ton on childcare and could you or your spouse maybe work from home?  Exactly what can be reduced will vary from person to person, so go over each item on your expenses list and think about how you could reduce it.

How to Manage Finances and Bust Debt

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IMG_7316 by Kurt Komoda, on Flickr.  This work is licensed under a Creative Commons Attribution-NonCommercial-NoDerivs 2.0 Generic License.


Starting to Pay Off Debt

By reducing your expenditure as much as possible you should find yourself in a situation where you are able to balance both – and have enough left over to start paying off your debt.  If you find that you can’t keep up with it regardless then you may need help from debt consolidation companies.

Assuming you are able to pay off some of your debt but not all simultaneously, try contacting the credit card company or your other debtors and see whether or not you’re able to negotiate a payment plan.

It is worth noting that research indicates that paying off debt is all about motivation and so starting with the smallest debt and paying that off completely before moving on to the bigger ones will help you stay on track.  Of course this is contingent on you being able to work out some sort of repayment plan in the first place.


By starting to manage your finances at the very least you should be able to get a clear picture of where you stand and how much help you’ll need.  Assuming all goes well you should be able to bust your debt down to size with no problem, or if not you can at least take other steps to do so.


Arnel Ariate is the webmaster of Money Soldiers.

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