The Path from Financial Troubles to Financial Freedom Explained
Growing up with parents who are struggling with bills and payments might be the perfect motivation that we need to keep us away from our own financial woes. We get our first job and start making our own money and start to become a little less dependent on mom and dad to provide for us and start buying things on our own. Then it's time for college and we move out and away on our own and really start feeling like an adult-in-training. And then it happens: somewhere down the line we've racked up our own little hill of credit card debt and overdue bills. Suddenly we find ourselves starting down the same path that our parents were and might still be on.
Whether you're already having financial woes or want to prevent yourself from falling too deep down the hole, one of the main things to keep in mind when it comes to your money and how you spend it are self-control and proper money management. Keep your needs in mind first and your wants second. You need groceries, but you only want that new pair of shoes. You need insurance, but you only want a new car when the one you have works fine. You need to pay off your credit cards, but you only want to go out to eat tonight.
Setting up a budget and sticking to it is a great way to start. Sit down and take a look at how much you make, how much you spend and how much you need. Again, the key word here is need. Factor in all of your bills and payments first, bearing in mind that your savings account should be viewed as a bill as well. While it may be difficult to adjust your lifestyle at first, you will reap the benefits of your financial makeover.
If you have any credit cards, try your best to pay them off as quickly as possible and pay more than the minimum monthly balance in order to save money on interest. It's also a good idea to cut up any credit cards that you don't need or use. While credit cards do have a certain appeal, they also come with several strings that have the potential to trip up the unwary. One of the reasons there are so many credit card payment plans and credit card companies out there is because companies realize that many people simply don't know how to properly manage their money and they exploit that fact so that they can make more money.
Other things that you can do to free up your purse strings are to get rid of any unnecessary services you may have such as cable, magazine subscriptions and phone services. If you find yourself flipping through your 300 channel cable service, you may want to think of either disconnecting it or switching to a service like Netflix. Not having cable offers you the opportunity to focus on other things in your like like reading, friends, your career, or any hobbies you may have. Try to cut your magazine subscriptions down to one or two that are your favorites. If you have a cell phone, then you really don't need a home phone. You can still talk to the people that you want, they can still talk to you and you don't have to worry as much about telemarketers calling you.
It's also a good idea to pay your bills either early or on time in order to avoid paying overdue fees and going through the frustration of having your electricity, phone or water cut off.
Read articles (like this one), books and guides on how to better manage your money and on how to get out of debt. Arm yourself with knowledge to better combat your financial foes and emerge victorious. It's also just as important that you put that information to good use rather than let it rattle around inside of your head. There's nothing worse than wasted knowledge.
Make a financial plan, stick to it and soon you'll find yourself financially free.