Each new year sparks resolutions for lifestyle changes for the upcoming year, but in 2011 financial changes will likely find their place near the top of many lists of New Year's resolutions.With so many individuals and families who are working hard to establish or regain comfort financially you, too, may find that it is time for you to take control of your finances and spending habits in order to achieve stability in today's economy. Essentially, this will also mean that there will be hard work and dedication on your behalf. When you have found yourself in a hole, you must be willing to exert the time and effort that it will take you to climb back out and onto your feet again. Fortunately, debts can be reversed when you remain dedicated to your cause.
In 2011, finding your way to financial freedom and stability can only begin by establishing a clear focus on your debts and bills. Take the time to sit down and determine your own budget. To begin, ask yourself these questions:
What is my monthly income?
How consistent and reliable are these sources?
Where do I owe money? How much?
What are my recurring monthly bills?
After rent, utilities and other necessities, how much do I have remaining for other expenses?
Although the initial idea can be quite scary in itself, it is important that you tackle your debts and gain a clear understanding of your bills before proceeding any further. By knowing exactly how much that you owe and to whom, you can then begin the planning process for overcoming those debts.
Another important step to financial stability is the ability to distinguish between expenses that are necessary and those which are luxury, or wants. Consider it this way: that extra four dollars that you are spending each morning for Starbucks could be $112 each month that could be better used by paying on bills and past debts. Though it may seem difficult at first, the journey to financial freedom ultimately means being able to sacrifice on luxury items that are not considered necessary. Rather than shopping impulsively, ask yourself if you really need that new gadget or if you would rather watch a movie at home than go out to the theater. Though the urge to splurge may still strike, refraining from spending that money will pay off more for you in the end.
Saving money to put towards your debts can be made interesting when you add a little creativity. Place a jar in your laundry room and charge yourself to both wash and dry your clothes, just as you would in a laundromat. Each time that you go to do a load of laundry, place your payment into the jar and collect at the end of the month. Think of it this way: if you were to charge yourself $1.50 each for use of the washer and dryer at only one load per day, at the end of the month you will have accrued $90 in which you can contribute to debts and bills. Though it may seem like little at the time, that daily change adds up and will help prevent you from spending it elsewhere.
You can also use some of that unlocked creativity to help you increase your income. Whether you choose to pick up an extra shift at work, sell on eBay or give guitar lessons to those who are eager to learn, any added income that you can achieve will be very beneficial towards helping you achieve financial freedom. If you are not having extreme difficulty getting by on the income that you already have, treat any additional income as though it does not exist by paying it directly towards bills. There is a common saying that "money unseen is money not missed" and when it comes to bills, that saying can hold significant truth. By paying your bills right away rather than allowing extra money to sit in your wallet, you are essentially removing all temptation to spend that money.
The journey to financial stability is undoubtedly an extended trip that can often prove stressful but when you are able to follow a few financial tips and maintain a clear focus on your main objective, you will soon see that your destination is not impossible.
By: Emily Ryanne
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