We are living in the age
of credit, with probably as much as 95% of the population in debt to
some degree. Mortgages, car loans and credit cards are all things we
have, and without some restraint, it is very easy to end up paying
out more than you are earning. Carrying a few pieces of plastic in
your wallet really does empower a person, and it is quite a
responsibility when you consider that we are constantly bombarded
with tempting offers, all designed to relieve us of some of that
hard-earned cash. If you find it difficult to resist spending, here
are a few useful strategies to help build self-control.
Be money smart
Take control of your finances and monitor what you do with your money. Rather than squander any 'spare' money be wise and invest it. If you want to invest but have little experience, invest with ease with SoFi. Invest with confidence and reach your financial goals plus by being money smart you can be in control.
Understand the difference between needs & wants
Sometimes the line
between a need and a want seems very fine, but if you ask yourself
this question, “Is it absolutely essential that I have this?”
prior to purchasing anything, this can remind you that it isn’t the
end of the world if you wait until your finances improve. It isn’t
always as straightforward as that, as you might be about to spend a
small amount that will actually save you money in the long run, and
in such a case, you are better off making a small investment that
will reduce your outgoings.
Cash only purchase rule
While this can be a
little inconvenient, paying for something in cash really does help
you to remember that you are spending money and not signing a
receipt, so maybe you should avoid using your credit cards for a
while. Some people end up with several large credit card bills that
they struggle to pay, and when that happens, there are online debt management services that can help you to clear outstanding credit
card bills by taking out a debt consolidation loan. This type of
company can also help you plan debt management, and they have helped
thousands of Australians to become debt-free.
Plan a daily budget
This is time-consuming,
but if you work out how much you can spend on a daily basis, then
that is your budget limit and by keeping track on every expense you
have, this can help you to budget for the month. If you are tempted
to buy something that you know you should not, remind yourself what
would happen if you were unable to make every payment and had to pay
interest on the card payments, and that should give you some
motivation. There are informative articles available online that
offer ten strategies for developing financial self-control, which is
recommended reading.
If you know yourself
well enough to understand that you are easily tempted with credit
cards in your pocket, leave them at home and make a decision that you
will only use the credit cards in an emergency. Some people even cut
their cards in half, but if you do that, you have no emergency funds
available, so it is better to store them somewhere safe and only use
them when it is absolutely essential.
By analysing your
spending, you can identify areas where you are spending more than you
should, and keeping track of expenses will give you a heads-up when
you cross that line and are spending more than you earn.
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