When considering tightening up your financial situation there are choices you can make that will put you in a better position. Unsecured debt is the first point of attack. Paying on high interest credit cards is like lugging around a debt ball-and-chain. You live paycheck-to-paycheck only to have your hard earned cash go straight toward paying your debt. There are a few simple ways to cut your monthly costs so that you can get these debts paid, and start saving.
To put it frank, we are a consumeristic society that loves to go out and spend. We all like to have new things. When the new cell phone comes out, the new cable package, the new computer, the new shirt, the new video game; we tend to want to buy now and pay later. This is why banks thrive. Use a piece of plastic to buy now, and pay it off in monthly installments. What most of us don’t realize is that if we are only making minimum payments once we have purchased our new item, we are looking at paying the bank for years until it is paid off. A different way to approach getting that new item without having to use credit is to put money away for a couple months, and once you have the funds; purchase the new item with cash. Cash is king.
For your monthly budget, there are ways to cut down what you spend on so that you can focus on getting rid of the debt ball-and-chain. With your cable package, consider dropping your package to basic cable until you can get one or more of your cards paid off. Get a free cell phone upgrade and keep a basic plan so that you are not paying $100 a month for a smart phone that we really don’t need. With the cost of gas being so high right now, find a few co-workers that you can car-pool with to the job site. Shop your insurance provider to see what other options are out there for cheaper insurance. When buying groceries, cut coupons out of the Sunday paper to save an extra $50 a month. Consider buying clothes or household items at a second hand store. I always end up finding great value purchases at second hand stores. Find a concert in the park that is free, instead of paying $50 for a seat at a big venue. Instead of paying for entertainment, go on a walk in the park or a bike ride.
These are just some of the ways you can better handle your finances. To get a good idea of exactly where your money is going, you should save your receipts and bills for 1 month and plug the numbers into a budget. You can find budget books to help manage your monthly budget and get out of debt online. It is not easy, due to the patterns that we put ourselves in, but it is time to rethink where our money is going. Do we really pay these companies 5 times what we owe in order to have something now? When is enough, enough?
It is time to rid yourself of the unnecessary bills you pay so that you can focus on saving for that lavish retirement. Good luck!