There is no doubt that we are navigating choppy waters at the moment. With global economies suffering, and millions of people feeling the pinch amid lockdown measures, stress levels are rising. If you’re worried about money, you’re unsure whether you’ll still have a job in the weeks or months to come, or your business has faltered, here are some suggestions to take the stress out of organizing your finances.
Whether you’re a business owner, you’re self-employed, or you’re worried about being able to run your household and put food on the table, reducing expenses is a positive step forward at a time when uncertainty reigns. Tightening your belt can help to save money and prevent overspending. Start by analyzing all your outgoings and identify areas where you can make savings. Lowering your monthly food budget at home, for example, will make a difference over a 6 or a 12-month period. If you’re a company owner, cutting out travel and commuting expenses is an obvious place to start. Most of us have non-essential outgoings. It’s wise to look into where your money is going and cut out luxuries for the time being if your cash flow is in jeopardy.
Taking advantage of financial support measures
Countries across the world have launched robust measures to protect the economy and provide businesses and individuals with financial support during the Coronavirus pandemic. If you are struggling, it’s beneficial to look into the programs and incentives in place in your state or country to see whether you qualify for support. From payment holidays for mortgages and credit cards to financial assistance for those who aren’t able to work, you could be eligible for help that will make a positive difference to your financial situation and reduce stress and anxiety. You can access information and research online to find out more about schemes that are currently running. It’s also worth contacting your bank, your mortgage provider and your credit card company if you’re looking to take a payment break, or you have questions about your overdraft or borrowing needs.
Taking control of debts
One of the most hazardous aspects of getting into debt is the risk of falling further and further into trouble. Once you start borrowing or using credit cards more frequently, it’s very easy to amass large debts. If you are in debt, and you owe money, don’t wait to seek help. There is very little chance of the situation improving without you taking action. If you continue to live beyond your means or ignore final demands or calls, the amount you owe will increase and money worries will take their toll on your health and wellbeing. It’s not easy to get out of debt, but it’s crucial to understand that there are solutions and there is help available. A debt consumer proposal may be a viable option for those who have no means of paying off debts, but there might be alternatives that can be employed before you reach this point. Discussing your individual circumstances with an experienced adviser can help you determine which measures will be best for you. Taking that step and asking for advice can also help to put a stop to threats and calls and lower stress levels.
Budgeting is one of the simplest but most effective ways to manage your money and take control of your finances. In difficult times, it’s not enough to have a rough idea of how much money is going into and coming out of your accounts each month. You need to ensure that you know how much you’re earning, how much you’re spending and how much money you owe. Learning to budget can help you regulate spending, work towards clearing debts and lay down foundations for the future. Many of us are surprised when we check our balances. If you find that you spend more than you think, budgeting is an excellent means of keeping tabs on your finances. Your budget should give you an accurate representation of your income and your outgoings. Once you’ve got the data in front of you, you can set spending limits and work out if you have money available to pay off more than the minimum payment on your credit card or to transfer to a savings account, for example. Your budget can also highlight areas where you might be spending more than you need to. Saving money on groceries, shopping around for better deals on insurance, broadband and phone contracts and stopping memberships and subscriptions you don’t use can all help.
Planning for the future
It may seem like we’re never going to enjoy better days again at the moment, but one day, life will return to ‘normal’, albeit a new normal for many of us, and we can start looking forward to the future. If you’re struggling now, focusing on the present and keeping up with bills is the best course of action. If you have a bit of extra cash available, putting it aside for a rainy day is a good idea. The Coronavirus pandemic has underlined and enforced the unpredictability of life and the importance of being prepared for any financial situation. Whether you’re thinking about your retirement, or you’re scared of finding yourself in a scenario where your income drops unexpectedly, it’s advantageous to have access to an emergency fund. Even if you can only afford to transfer a small sum each month, this will soon add up.
There is no doubt that millions of people all over the world are experiencing stress related to their financial position. If you’re worried about debts, your business is under threat, or you’re struggling to make ends meet, there are steps you can take to try and organize your finances and find solutions. There are support measures in place to help those impacted by national and international lockdowns, financial advisers can help to explain and provide guidance related to getting out of debt and you can use techniques, such as budgeting, to take control of spending and reduce expenses.