Do you tell other people you’re hopeless with money? You’ve come to this conclusion because you’re always broke and worry every time you swipe your credit card at a cash register because you might have hit your limit. You also justify this dismal opinion about your money management skills by pointing out how you’re living paycheck to paycheck and don’t even have $400 in savings for an emergency.
Unfortunately, many Americans are now resorting to impulse spending during the outbreak of the COVID virus…but, here’s the thing: you can turn things around for yourself by learning a few simple money-management strategies. The solution to your financial woes is to find the root cause of your problems and take constructive action.
Let’s review some money-management strategies you can use to settle your debt, protect your savings and reduce impulse spending
Pay Everything Off by Consolidating Your Debt
Consolidating your debt into a single debt is an efficient way to pay off your debt rather than paying off each creditor. Besides providing debt relief, this debt restructuring method allows you to minimize any damage done to your credit score. By comparison, using a debt settlement plan to pay off your debts will only hurt your credit score. A credit counselor at Georgetown Funding can explain how loan consolidation will benefit your credit score rather than hurt it, how this method will reduce your interest charges, and how it will help you get out of debt faster because you’ll be paying more on the principal of the debt.
Protect Your Savings
If you dip into your savings now and then to cover an unexpected expense or to buy a few things that you can’t afford to pay from your budget desire, then you need to protect them from yourself. Place some barriers to making it tougher to make a withdrawal. For example, move your savings account.
Spend Less Than You Earn
Besides saving money by setting some money aside for the money that you receive, you can also save money by spending less on things you do not need but just like to have.
If you can’t control impulse spending, there’s something a little drastic you can try — curb your spending for a week to reduce your addiction to retail therapy. This exercise will help you get your finances back in order, too. After a week, it might surprise you how many things you thought were necessary were really things you could do without.
Another way to spend less than you earn is to get better at shopping. For example, buying grains, such as rice, in bulk rather than buying prepackaged boxes am both a cheaper and healthier way to shop.
Although it might be difficult to live as a minimalist for a short period, you will have time to notice your unconscious spending habits and see where you are wasting money on things of low value.
For instance, you might not realize how much money you spend on food…
You can save money by eating out less. Try taking your own lunches with you when you go to work. You are probably spending far more money during lunchtime than you realize. All it takes is a little discipline to start brown-bagging your lunch.
Food expenses are often high because people don’t know how to cook. So they go out to eat for both lunch and dinner. While it’s fine to splurge at a restaurant as a treat, eating out shouldn’t be your go-to resource to feed yourself. You’ll save a considerable amount of cash by learning how to cook and how to plan your meals for the week. These are easy skills to learn. You could ask someone to teach you how to cook and or take an online cooking course.
Besides saving you money, brown-bagging your lunch and cooking your own meals will also improve your selection of food. Instead of relying on foods loaded with preservatives at restaurants, you’ll be preparing your own healthy meals with fresh ingredients.
In closing, if you’re spending more money than you can afford and creating financial problems for yourself, you’re handling money the wrong way. By following these suggestions, you’re now well on your way to improving your financial situation.