You’d run out of fingers to count all the things you’d rather do with your time than sit down and think about your finances. Between catching up on Netflix, cleaning your house, and fixing up your yard, there’s probably not a lot of time leftover to spend on your finances. But it’s time to put a stop to your procrastinating ways and focus on your money. The average Canadian is carrying around $20,069 in consumer debt, and the only way you can break the mould is if you concentrate on getting out debt. Here are some things to keep in mind when you accept your responsibility.
Become goal oriented
You have a higher chance of success with your finances when they have a purpose. Ascribe a reason why you’re spending and saving your money the way you are. This trick helps focus your energies away from things you don’t want to spend your money on. It also gives you the motivation to stick with restrictive spending limits. When you have an inspiring reason for eliminating your typical weekend takeout — like, let’s say saving for a vacation to New York City — you can justify the hole it leaves in your life.
Just make sure you make it personal. Don’t let outside pressures like your family or friends make you set goals you don’t want. Whether you’re saving to buy a home, go on a trip, or financing daily takeout, make it your own.
Take stock of your finances
You won’t know how you’re spending until you track each transaction with a budget. A budget helps paint an accurate picture of your money, outlining in the black and white of your Excel file the money coming in and out of your accounts. Your goal is to balance your budget, so you’re making more than you’re spending.
If you’re breaking even each month — or worse, running a deficit — your finances are on rocky ground. Not only does this make it hard for you to reach your goals, but it also puts you at a disadvantage should you encounter something you don’t usually budget for — say a speeding ticker or auto repairs following a fender bender.
Be prepared for the unexpected
Some of these unexpected bills or repairs can be ignored until you’ve budgeted and developed enough savings to pay for them. Other things have immediate due dates that you need to follow. For those urgent bills or repairs, the fastest way to borrow money is through an online lender. Traditional banks follow branch hours, making it difficult to secure assistance for those whose schedules don’t match up with the regular 9–5. Online lenders operate 24/7, giving these individuals an opportunity to get the cash they need right away.
Start putting away savings
While these financial products are ideal for momentary cash flow problems, they aren’t meant to become a permanent fixture in your budget. Try using your budget to eliminate harmful spending habits and use that money you’ve freed up to put away into savings. Even a small monthly contribution of $25 is better than nothing, but ideally, you want to put away anywhere between 10 and 20 percent of your net income into savings.
If your budget is so tight that you have no leftover cash after you paid for the necessities, you need to speak with a professional. A financial advisor can recommend your best course of action when you’re facing considerable debt.
All you need to do is get the ball rolling. Though you may prefer to do nearly anything other think about your finances, sometimes you have to do what you don’t want do. Take some time to look over your finances and get on top of your debt.
