Every week, you live with the fear that your pay may not get in. It is barely deposited in your account that the amount is already spent, almost completely to the last penny. Definitely, you are struggling to make ends meet, and you seek a solution to get away from that. So here are a few tips to reorganize your finances.
To get a clear idea of the steps to undertake to get back on your feet, it is better to begin with a complete review of your assets (house, car, and savings) and your debts (loans, credits). If the total turns out negative, rectifying the situation by paying off your debts is an emergency.
Before getting to that step, however, you need to plan a budget, which will help you to monitor your expenses. You simply have to compare your monthly revenues with your expenses, including grocery, gas, and outings. Again, if the result is negative, that’s a sign you should change your expenses.
Analyze them to know which expenses can be cut down or eliminated. For example, are your cell phone and TV packages bigger than what you really need? Could you reduce the number of restaurant meals you eat monthly?
Your review and your budget will also allow you to determine which debts are the most important. This way, you will be able to choose which ones should be repaid first, whether those with a greater capital or those with higher interest rates. Every time you finish to repay a debt, you can place more money on another until everything is paid.
If you have too much debts and you are overwhelmed by interest rates, you can also get a debt consolidation. In this way, you will have only one debt. Hence, you can obtain a loan with a traditional bank or by refinancing your house with a private mortgage loan from an alternative financing society. By doing so, you will be able to repay your debts more quickly, and you will lose less money with high interest rates.
Once all your debts are repaid, it could be tempting to contract new ones. Bad idea! Instead, you should take advantage of your extra money to save it, and create a financial cushion. Thus, if there is an unexpected event, you will still have money to pay your bills or to repay your mortgage loan. So you will not have to fear a 60-day notice nor calls from your creditors. In addition, you will have an excellent credit score.
If you need to get a new debt, for house renovations or to replace the fridge that just broke for example, you should think to a personal loan rather than using a credit card, unless you are able to repay the balance during the next month.
Finally, if the situation worsens to the point where you have no other choice than taking a private mortgage with a company like Clic Hypothèque, tell yourself it is only temporary. We are offering short term solutions, so you can recover your financial credibility quickly with traditional institutions.