If you're sick of living paycheck to paycheck or tired of having to work with such a tight budget, it's time to pull yourself out of that financial rut. Spending and managing money does involve a conscious decision-making process. When you're stuck in a financial rut, sometimes it feels like money is just slipping out of your fingers and it's all out of your control. Catching yourself before those bad spending habits lead to debt problems or a full-blown spending addiction can help you keep your finances in good order and ultimately, enjoy a better quality of life.
Here are five things you can do to get out of a financial rut:
#1: Set some new, short-term goals. Setting a goal to "save more money" or "stick to a budget" aren't specific enough to make a real difference to your current habits. If you want change to happen, you have to be very specific and start with some inspiring, short-term goals. Make a commitment to save $25 this week so you have $100 in savings by month's end. Say "no" to a few luxuries for the week so you can meet your goal. Setting - and reaching - small goals like this can make it that much easier to get a better handle on your finances.
#2: Start taking notes. Writing down every penny you spend for an entire week - whether it's paying a bill, picking up items at the convenience store, or filling up the gas tank - will make you more aware of your spending habits and how much cash is really leaving your hands. Just looking at the numbers can give you a better sense of where things stand in the financial department.
#3: Be realistic…and honest. It's easy to put off budgeting or avoid thinking about your finances because money matters can be an uncomfortable topic - especially if you know you're guilty of overspending and splurging too often. Be as honest as you can with yourself about how much you're spending and how much it really costs to run your household. Sit down and crunch those numbers so you have an accurate baseline to work with.
#4: Stop making excuses. If you have ten reasons why now is not a good time to make a budget or start saving, you're setting yourself for failure. Create a realistic, flexible spending plan that works for you - remember there is no cookie-cutter approach when it comes to managing money and the sooner you get a handle on your own financial situation, the easier it will be to make plans, set goals, and get where you want to be.
#5: Make small change and build yourself up slowly. You didn't get into a financial rut overnight so you can't expect to reverse the damage in one big sweep. Set small goals and make tweaks to your spending habits so you can build yourself back up slowly. You have to be patient with yourself and start out with small adjustments.
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