Two headlines in my area have been about a hillside that has gradually been shifting and sliding closer to the houses on the hill; and about a ponzi scheme that left hundreds of investors broke. These two headlines have caused me to consider what I would do if I found myself in a mess that could cause my financial ruin. A home and retirement accounts are huge assets you don’t ever want to find yourself without, but what about smaller financial situations that don’t turn out quite like we expected. How can we recover from those situations and bounce back. We all have situations that hurt us financially, so here are four simple ways we can start to overcome those situations and make our future a little brighter.
Open A Savings Account
When it seems you have nothing to save, open a savings account. Scrounge up enough money to meet the minimum balance and find the best bank to fit your needs. Even if you only contribute $5 each month to the savings account, start. Having something building instead of depleting will help you get your foot back on the right track.
Pay Down Debt
The typical smaller financial situations that can seem to hurt us are debt. If you see yourself continually sinking into the debt hole, start clawing your way back out. Cut back, scrimp, save, get more work, do whatever you can to dig out of that hole. Paying off even the smallest debt provides such a sense of accomplishment and relief. Once one debt is paid off, work to the next; but don’t get further into debt with one credit card while you are working to pay another off. Take a set amount of time to live without all the luxuries and work to pay off those debts.
Sell! Sell! Sell!
That boat that you are paying on, or that trailer, or that furniture you bought on credit and can’t afford, sell it! Take inventory of what you are making payments on that aren’t a necessity. You can find ways to justify anything, but if you are on the brink of financial ruin, simplify your finances as much as you can. Even if you are left with a little debt from the sale, at least that debt is more manageable and able to be paid off faster.
Know The Necessities
Be very honest about what a luxury is and what you are passing as a necessity that is really a luxury. Those designer clothes, expensive dinners and entertainment, or toys and big ticket items like previously mentioned are not truly necessary. Look at where money is being spent that could be saved. Those simple changes can free up hundreds of dollars each month to deposit into the new savings account you opened. Live with the necessities and give up on the luxuries to overcome debt and gain control of your financial future.
Keep Working Hard
I hope your financial situations aren’t as catastrophic as the two headlines I mentioned. I also hope that if you have made some bad financial decisions that now you want to recover. Start with these four simple steps to get you on the right path. It will take time and will be very hard, but so worth it. Start today to save money to make your future a little brighter.