Many people take risks with their finances. Some are logical risks which made sense at the time, others aren’t and can be quite damaging. Others may not have taken a risk at all and are in a bad situation due to external factors. Covid has been a scourge of many businesses and individual finances this year. People have been made redundant, some companies have used it as an excuse to fire off colleagues and restructure, and self employed people have been left with no work. It’s hit certain industries more than others too. The hospitality sector has been gauged of customers as the virus has ebbed and flowed meaning earnings have plummeted. So has the travel industry. With a second wave seemings coming across the world, there’s not yet an end in sight though experts are looking at the new year and predicting a wane in problems, but the issue is most people in financial duress and businesses which are running out of spare funds can’t wait that long. So what can you do to survive financially? The problem here is that everyone has separate and widely different circumstances. It means that unfortunately, you won’t be able to utilize all the advice you read as it won’t be applicable. But it can help you where it is, and it certainly will ensure you change your perspective if needed. Good luck!
Be Honest With Yourself – It May Go Wrong
Before you can look at success, you need to deal with the issues which you’re facing. If the ship is sinking, it’s time to get off. There’s no point trying to instigate little things which will save a small bit of money but will be nothing but a tiny drop in the ocean. This is why, if you’re in a bit of a mess, you might want to look at Leinart Law Firm for bankruptcy information. Of course, you might not be that far down the rabbit hole. Sometimes being honest with yourself is just taking the situation by the reins and deciding that you need to make positive choices to get yourselves out of a rut. Or realising that you need to make key changes in your life if you don’t want things to get worse. Being honest with yourself and indeed, your family or partner, is the first step and in some cases, the hardest one to take. The fact you’re reading this means you’re well on your way. Before looking at some of the more complex ways to push yourself into a favourable position, you need to eliminate any bad habits.
Educate Yourself And Plan Up
So you’re losing money, why? Why is it that each month you’re spending more than you make? It sounds like a silly or simple question, but it’s one which can get you back on track. First, you need to make a financial plan. Draw up an excel spreadsheet, or do it on a bit of scrap paper. You need your income, maybe it’s just yours or potentially your partner’s too. Then you need your outgoings. You need everything here…and be honest about it too. How much do you spend on coffee a week? How much do you spend on food, on bills? Everything from your mortgage to your car payments and money spent on children’s sports. Once you’ve got everything down, and you can see it all, you might see where you’re going wrong. Having the visual in front of you will really make all of the difference. When you start playing with the figures and amounts you can see what you need to do to make your life financially viable once more.
The Debt Snowball
One of the biggest killers of a person’s finances is debt. Most people have it, and it’s fine to a point. It’s when you start taking out huge finance agreements or credit cards that you run into trouble. If you’ve got multiple agreements it can feel a little overwhelming. To get out of this, make minimum payments on all your debt, and divert any income you have to paying off the debt with the lowest amount. Don’t worry about interest for a moment. Once that’s paid off, then pay the next, then the next, until you’ve paid off these items. Snowballing like this is great because as the pay the debt off the minimum payment accumulates and you have free money, which you use to pay off the next slug of debt. As you go you snowball the amounts and reinvest into the next bit of debt. It doesn’t give you more disposable income until you’re debt free (not including things like mortgages) but it’s a great way to sort your finances out quickly and without borrowing extra money.
Consolidate The Debt
Another way of paying off debt is by consolidating it. If it’s growing fast and you feel like you’re in danger, paying it off can allow you to pursue success. You need to search for a consolidation loan with the best interest rates. Use that money to pay off all of your other debts. Then you’ve only got the one left to pay for. These work if you’ve got debt in a couple of different places and it’s becoming a little hard to manage them all. Having everything with one bank, on its own, is a great management tool, even though it’ll look larger because it’s all in one place.
Investigate Your Mortgage
One way to free up a considerable amount of money is by looking at your mortgage. If you’ve been with the same provider for a long time, it might be time for a change. This is important because if you’ve exhausted your initial rate, you need to get a new mortgage. Mortgage companies usually offer an attractive rate for the agreed initial period, this can be for whatever period you decide, but after that it will go back up. Sometimes by a lot. If this has happened to you changing can save a decent amount of money. There are a few ways you can do it. Yourself, of course, by looking at the different providers and what kinds of rates they offer. Or by going to a mortgage broker who knows the market better than you and will likely have access to a lot of other providers which you don’t. The issue is that they won’t have access to everything, so you’ll still need to do a bit of searching for yourself. Get the best deal possible and use the extra money wisely! Remember, brokers will usually charge a fee, always make sure this fee is payable on the other side, meaning the bank or mortgage provider will pay the broker, you shouldn’t have to pay them yourself.
Don’t Underestimate The Side Hustle
Feeling like you need a little hit of cash to steer you through some dangerous times?If you need a little extra money, whether short or long term, then the side hustle can sometimes answer all of your problems and allow you to glow into success. People have different skills, and as such different things to offer. Once you’ve found your niche you can make a little bit of money on the side. For example if you have a degree you can offer your time as a tutor for those studying in school or university. If you have a flair for writing you can pick up a freelance gig. Maybe you can Uber? Whatever you have to offer, remember that you’re giving up your time to do so and you can’t do this if you’re already overloaded. Think about coaching sports, or even picking up another small, part time job. There will always be something to do for everyone, you just need to sit down and really think it through.
Think Of A Change Of Career
It’s a big and drastic step and won’t be for everyone. The truth remains that certain jobs in various industries pay really low. If you change, you might be able to command a better salary. Of course, this isn’t always easy depending on your circumstances, but it might be worth thinking about especially if you already have the skills and experience to apply for the role. It’s a big step, especially if you need to study beforehand and it might not be the answer if you’re needing money quite quickly. However, it is a long term aspiration to work towards, especially if you’re unhappy in your role. If you’re happy, you’ll work harder, which undoubtedly leads to success.
Cut The Wastage
You need to stop wasting money if you want to save some money and leave the point where you’re spending more than you make. This ranges from the simple stuff like cancelling that gym membership which you never use, to cutting those big ticket items like cable. Do you use Netflix more? Then stick to it. If not, cancel Netflix. Are you one of these with a Netflix subscription, along with Prime Video, and Disney Plus? Do you really need them all? This might sound a little petty but at the end of the day when you make multiple changes like this it all adds up quite quickly meaning you save more money, especially if you combine this tip with some of the others in the article. Some of the cuts might be a sacrifice, but not if you have other things to lose. It’s about being tough on yourself and asking those hard questions.