Most people worry about money frequently and some people fret over their finances on a constant basis. Things can get to the stage where nothing in life is very pleasurable since every action is always thought of in terms of how much money is being spent.
The key to turning this situation around is to make sure that you are firmly in control of your money and that you then make good decisions regarding your finances.
It's not necessary to worry when you know you can cover what you need to, that you have a reserve fund and that should hard times arrive you can downsize your spending to avoid a crisis.
If you arrange your life to enable this level of assurance then you have financial stability and therefore no reasonable cause for concern.
Concerns over money have a very real basis. Rent, food, clothing, education, transport or medical expenses are all essential things that cost money. If a person is in a situation where they cannot afford these expenses as they arise then their life will start to be adversely affected.
In order to progress towards worry free finances you need to be sure that you are living well within your means. Your living expenses should be comfortably covered by your incoming funds and ideally you should be putting regular chunks of money into savings and investments.
In order to live well within your means you need to understand your lifestyle in terms of cost. Most people worry about money because they have little or no control over the flow of money in their life; bills come in, money goes out and they never seem to have enough or resort to borrowing and watch debts grow bigger by the month. Knowing your financial structure is the first step to being able to change it for the better.
Look at bank statements for preceding months and analyze your spending. Separate expenditure out into essential and non essential. Examples of essential expenses are rent, grocery shopping and transportation. Examples of non essential expenses are eating out, entertainment or subscriptions to TV channels and magazines.
To reduce living costs non essential items can be removed or spent on less frequently and essential items can be downsized and reduced. You can also examine your incoming funds and work out ways to increase them via a few extra hours of overtime, a part time job or an independent home run business.
Create a balance where you are living your life well within the boundaries of the incoming funds. Make sure that every month a certain amount of money, however small, goes into savings.
It's not only a case of trying to work out how to earn more but how to use what you do have efficiently. We live in a purchase driven society. Everywhere we look there are advertisements and almost every conversation will touch on something someone purchased or some activity that required money to be spent even if it was as simple as an inexpensive day trip.
Be aware of the purchases you make. Do not let money flow out of your hands on the demand of advertisers when you do not want or need the items or could find them elsewhere at a better price. Don't be someone who only has to walk through town on your way home in order to be spending huge amounts of money just because the shops were there in front of you. If you have no control over your money then you will always be worried about it.
Be clear in your mind that your non essential spending or fun money comes second to your essential spending. The stress of day to day living is vastly reduced when this perspective is applied. Many people spend and spend and then when a bill comes through the door they worry about the money that now needs to be found from somewhere.
Set aside your essentials money and your savings money every month and then choose what to do with what is left. As opposed to being restrictive this is a much more relaxing way to use money for socializing or enjoyment. You know that what you choose to do is affordable for you. Squeezing in another night out with friends by putting it on a credit card is easily done but the night will not be much fun when you're thinking about the fact that you're ruining your finances by being there.
Having a limited amount of money for socializing and relaxation can push you to explore new ways of having fun both by yourself and with friends. You may think up completely free ways to kick back or even ways that make money for you or charity. This process puts the focus firmly back on the people you choose to spend time rather than where you go or what the price tag is. Knowing what you want to do with your time and who you want to spend it with is very life affirming and increases your appreciation for the things you have.
Be organized and know your wants from needs. This way if a crisis such a recession or job loss occurs you will immediately know what to do. Instead of panicking and tearing your hair out you can calmly go through your expenses and apply a combination of elimination and downsizing. If you lose your job you can put your time into the business you set up on the side rather than letting your income sink to nothing.
Get your finances into your control and then make good decisions about what you do with your available funds and you will find that you barely have to worry about money at all. If a problem arises you will have options to follow to fix it and this means that even if a difficult situation arises you will be ideally placed to cope with it.
Thursday, February 14, 2013
Subscribe to:
Post Comments (Atom)
0 comments:
Post a Comment