Have you made some poor financial decisions in the past and now you’re trying to undo the damage and get back on track? It can be pretty frustrating when you think about how much digging you have to do to get out of debt.
In fact, many people take a look at their finances and immediately get discouraged. They just can’t imagine any way they can possibly pay off all their debts and take control of their finances.
But I want you to know that no matter how bleak the situation looks right now, it is never hopeless. Sure, you’ll have to make some tough decisions, cut back on your expenses, and bust your butt to earn more income…but with focus and determination you can do it.
The most important step in getting your debt under control is to stop the bleeding. Your current spending habits are what got you into debt in the first place so now is the time to make some changes.
Start by taking a cold, hard look at your spending. You might feel like you only spend on absolute necessities but everyone has expenses they can cut without even thinking about it. Are you overpaying for your cable or cell phone packages? Paying more than necessary for items simply because you’re too lazy to spend a few minutes shopping around online? Getting hit with overdraft charges and credit card late fees because you can’t balance your checkbook?
These money leaks are very common and they could be keeping you from reaching your financial goals.
It should go without saying that you should stop using your credit cards immediately. The goal is to get your balances paid off as fast as possible and that won’t happen if you keep charging away. Stop carrying your credit cards around with you everywhere you go or freeze them in a block of ice if you don’t think you can withstand the temptation to use them.
You may even want to cancel some of them (though that may have a negative effect on your credit score* in the short-term) and transfer all your balances to a card that offers a low introductory APR. There are many cards that come with zero percent offers for a year or more, as well as bonus points you can use to earn valuable rewards.
*Check Your Credit for Free with Credit Sesame
The key to remember here is that you have to learn how to live within your means. If you don’t have enough money to pay for something, don’t buy it.
Of course, that is easier said than done in today’s world where everyone wants to have the latest gadget and the hottest new outfit to impress their friends. But overspending to keep up with the Joneses will lead only to disaster. Sure, you’ll look really good at first and you may impress a lot of people. But when the bills come due will they be there to help you pay for all that stuff?
What other tips can you think of that would help trip your spending?
Image via Tax Credits; enhanced by me!