If you dread opening the mailbox because of monthly bills, it may be time to evaluate your financial situation. Having too many bills and not enough income is a major red flag. It likely means you are exhausting your income which leads to debt. You are jeopardizing yourself even further when you use credit cards to make it from month to month. If this sounds like you, here are a few tips to help put you in the driver’s seat and take control of your personal finances.
Take Control if You Have Too Many Bills and Not Enough Income
Balance Your Books
The first thing you must do it to balance your books to see why you have too many bills and not enough income. Inventory all your bills and outgoing payments within a month. Write it out instead of pulling it from memory to be certain you don’t miss anything as well.
The easiest place to begin is with your monthly statements. It can be overwhelming if you have a lot of bills coming in each month. Break them into smaller categories like utilities, loan, and credit card payments and deal with them one by one. If you tend to forget payments, set up electronic ones online. Then you will never have to worry about late fees or other penalties again.
Review the Monthly Budget
As you are looking over those monthly bills, pay attention to the larger expenses on your credit card statements. This is a great way to review your family’s spending habits and see where all your extra cash is going every month. Those micro-transactions for fast food, coffee, and other daily expenses add up quickly. Enforcing a little self-control and sticking to the budget saves more money than you might think.
Another way to reduce your monthly spending is by getting rid of unnecessary expenses. Eliminate subscriptions, memberships, or services that you are not fully utilizing. You can also look for bundled or packaged services for insurance and telecommunications. Be sure to shop around and compare prices to get the best prices possible.
Eliminate Your Debts
The next step to regain control of your finances to tackle your debts. Contact any lenders or collection agencies where you owe money. Discuss settlement and repayment plans to get you out of the red. Often times, you can negotiate for manageable terms since they are willing to work with you.
If you have considerable credit card debts, you may want to consolidate your debt into a single monthly payment. You can do this with a refinancing loan or go through a debt relief agency to negotiate on your behalf. You will usually get lower interest rates as well.
Increase Your Income
Of course, the easiest way to solve this is to get more income. First, look for opportunities to earn more at your current job. You could pick up extra hours, ask for a raise, or go after a promotion. It is much simpler to increase earnings at a job you already have than to find a new one.
However, if you still have too many bills and not enough income, you may consider a second job. Another option is to search for ways to earn passive income. This could be the perfect time to turn your hobby or services into a small business venture.
Finally, you cannot make excuses for your poor decisions. Avoiding your financial issues won’t solve anything. Furthermore, small issues will easily grow into more serious problems the longer you look away. You must be brutally honest with yourself to get spending habits and debts under control. Rationalizing your behavior is not helpful or beneficial for your financial health.
It takes sacrifice and discipline to reach your financial goals, no one can do the work for you. Most importantly keep a positive outlook and remind yourself that you are capable. You should also find ways to motivate yourself to continue moving towards your ultimate goals. It can be a long and arduous process, but there are ways out of financial hardships towards a more secure future.
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Jenny Smedra is an avid world traveler, ESL teacher, former archaeologist, and freelance writer. Choosing a life abroad had strengthened her commitment to finding ways to bring people together across language and cultural barriers. While most of her time is dedicated to either working with children, she also enjoys good friends, good food, and new adventures.