Statistics tell us that, in these fast-paced and competitive times, almost half of all Americans are struggling to even make it from paycheck to paycheck!
While we may experience stress in almost every aspect of our lives, financial stress has the unique quality of adversely affecting not only your health and emotional well-being, but also your family’s well being by extension.
However, before you do anything drastic, you should know there are measures you can take. Today we will go over some tips on how to improve your financial health.
These won’t only improve your financial standing, but it will also help you build a future for you and your family.
Your first step should be to assess your current financial position and figure out where your money is going. Go over your financials for the last few months and track your spending habits.
There isn’t much you can do to change the amount you spend on essentials such as groceries, rent, utilities, other bills etc.
However, you can make adjustments for everything else as the remaining amount is your surplus. You’d be surprised how much you can end up saving if you’re mindful about how much you’re spending.
Once you’ve figured out where your money goes, you’ll need to sit down and make a budget. While your essentials, car payments and mortgage can’t change, you can set limits on discretionary spending for entertainment and recreation.
Once you have a formal spending plan, saving and investment becomes a lot easier too. You can even look to pay off a loan faster than expected and reduce the stress in your life.
One of the most commonly followed spending plans is the 50/30/20 rule. Half of your salary should be used for essentials, bills, and loan repayments, whereas 30% of it can be kept aside for all your entertainment and recreation spending. The remaining 20% of your salary should ideally be going into some form of savings.
If things are serious and your liabilities are on the higher side, your spending plan might have to include some drastic steps.
You may have to switch to a smaller car or apartment to save on money and even look into a debt consolidation loan (more on that below) to help you manage your numerous loan payments.
While taking such steps may be difficult and can even leave a lasting impact…
Continue reading the article and learn more about personal finances on Tammy Broccas’ blog.