These are unsettling times. The economy is unstable and there is no guarantee things are going to get better. Now, more than ever, it is critical that you steps to keep your finances in order. The following tips will help you create more stability in your financial life:
This is a critical step in getting control of your finances. Getting rid of debt is the first thing you should do. A good way to do this is to choose one debt and start making double payments on this debt. Once that debt is paid off, take the amount of the double payments you were making and apply it to a different debt. Keep repeating this process until you are debt free. If possible, consider refinancing your home for a lower interest rate or a shorter mortgage term. If it is time to trade in your vehicle consider downsizing to a more inexpensive vehicle or simply pay off your car and drive it for a while.
2. Develop A Budget.
No household should attempt to function without a budget. A good budget allows you to get a realistic picture of how much money is coming in and going out each month. Look for ways to reduce spending so you have a larger surplus each month. You may need to cut back on cable services, start taking your lunch to work, or reduce the amount you spend on things you really don’t need.
A savings account is a must in these rough times. Financial experts now recommend that you should have at least eight months of living expenses in a savings account. This is because it is taking laid-off workers longer and longer to find a job. So if your monthly expenses equal $2,500, you would need $20,000 in a savings account. Realistically, few individuals are able to save that much but try to put away as much as you can to build your financial cushion.
4. Make Yourself Marketable.
It is important you do everything you can to make yourself marketable to employers. Keep yourself up to speed on new advances in technology. If you work in a specialized trade, make sure you are current in new developments in your trade. Keep your resume updated to reflect your achievements. The job market is tough, and you have to do everything you can to make yourself stand out.
5. Invest In Yourself.
Health problems can take a toll on your finances. Do your part to avoid health problems by eating right, exercising at least 30-minutes each day and getting adequate amounts of sleep. It is critical you avoid risky behaviors such as smoking or drinking to excess. Stay away from elective medical procedures and maintain a healthy weight.
6. Look For A Sideline Income.
This is a very important aspect of getting control of your finances. These days, a job is not a guarantee of a stable financial future. It would be smart to investigate ways to make money on your own. Think about your skills and consider freelancing. Develop a good customer base. The extra money will help you pay down debt faster and also help you build your savings account. If you do get laid off, your freelancing business will give you something to fall back on.