personal-finance-and-accounting

 

One of the scariest thoughts in life is wondering if you can financially survive in this world. Everyday, we see people end up in situations that leave them with no choice but to penny pinch. These issues arise from people losing jobs or simply overspending, for example. Although each issue may be different, the common ground is that there’s no longer  access to the cash flow.  You may borrow from Peter to pay Paul. But, that only lasts so long until friends and family get tired of  you asking and completely cut you off.  Others may take out a line of credit or loan…only to end up more in debt. So, at what point do you “check” yourself?

 

There comes a time in everyone’s life where they have to step back and conduct a self-evaluation. Dealing with some sort of financial turmoil is one of those times. When this happens, instead of diving into a deep depression, use the time to ask yourself how did you allow this to occur. A good way to begin your self-assessment is to answer a few questions. Be honest with yourself. The worst thing you can do is lie to yourself. So, keep it 100 and assess your answers. Examples of a few questions are:

 

  • Do I pay my rent/mortgage and household bills on time?
  • Do I have a 3 to 6 month in emergency funds tucked away in a savings account?
  • Am I an impulse buyer? Or do I search for discounted merchandise/products and clip coupons for grocery shopping?
  • Do I have more than 3 credit cards? Are they paid up or in serious default?
  • Do I set a monthly budget for entertainment related expenses (i.e. movies, dining, shopping, etc)?

 

 

Once you’ve answered those pertinent questions, then the next step is to outline it all. Create a checklist of your current expenses. Subtract those items from your current income and money available in your bank account. If the bottom line shows that you are in the red, check your expenses and determine which items you can do without. If you do a daily stop at Starbucks, find an alternative like buying instant coffee for your home. This will instantly cut down the amount of money you’re spending on Starbucks.

 

Be persistent in your efforts to live a debt free life. If you know that you love buying the new Jordan’s, miss one or two release dates. The key is to consciously train yourself on how to refrain from unnecessary spending.

 

Non-frugal people will indeed have a difficult time going through this process. Keep yourself motivated by reading cost-savings tips online. Read your Bible and attend church. Talk to friends who may be going through the same thing or have experienced a financial downfall at some point.  The whole idea is to use positive energy and thoughts to help you use self-discipline.

 

You can do it!