If you’re sick of being broke, it’s time to take control of your finances! Whether you need to work on your spending habits, learn how to save, or find ways to earn more money, you can find a way to stop being broke. Follow these steps to start working towards financial freedom and better peace of mind.
Here some knowledge to share with you all:
Set goals. If you want to change your financial situation, you need to get specific about want you want to accomplish. Think about exactly what you want your finances to look like and what you can do to achieve those goals. Setting short-term goals in addition to long-term goals can help keep you motivated by providing you with a sense of accomplishment. Create a budget for non-essential items and hold yourself accountable for it each month. If you go over-budget one month, tell yourself that your budget for the next month is reduced as a result
Stop comparing yourself to others. If you’re spending beyond your means because you feel that you need to keep up with your friends or show others that you can afford a certain lifestyle, you’re not doing yourself any favors. Stop worrying about what others can afford and think about how you can live within your means. Stop equating your self-worth with your ability to buy things. This kind of thinking will make you extremely unhappy in the long run and will probably get you stuck in debt forever. Change your attitude on consumer goods. Stop reading fashion, home style, and consumer technology magazines and watching flashy TV shows that make you feel bad about not having the latest designer item, gadget, or home improvement item. Choose quality products that will last a long time, but don’t pay more for brand-name items just because they are fashionable.
Track your expenses. To understand exactly where all your money is going, keep careful track of every dollar you spend. You can do this with a pen and paper or electronically if you use a card for everything, but make sure to account for everything. This simple habit will help you spend more wisely. Try categorizing your expenses and adding them up on a monthly basis. For example, you could create categories for food, housing, transportation, utilities, insurance, entertainment, and clothing. Then calculate what percentage of your income you are spending on each category. You might realize that your expenses in some of these categories are way too high. When purchasing a non-essential item, try thinking about how many hours you would have to work to pay for it. Make sure to plan for large expenses too. For example, if you pay $600 for car insurance twice a year, calculate $100/month into your expenses. To understand how much you can afford to spend each day, subtract your fixed expenses from your monthly income and divide the remaining amount by 31
Make a plan for getting out of debt. If you are broke because you have credit card debt, a car payment, or student loans, think about what you can do to pay off these debts faster. Making even a few extra payments each year can help you pay off your debts much faster. While making extra payments towards your debt might make your budget even tighter in the immediate future, it will pay off in the long run because you will be debt-free much sooner. Make sure you understand how long it will take you to pay off your credit cards if you only pay the minimum amount due and how much you will end up paying in interest. You may be able to renegotiate the terms of your loans to get better interest rates. It doesn’t hurt to ask!
Hope this will help!