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Financial stress is far more common than you might think. According to a 2023 survey, 52% of Americans admit that financial stress adversely affects their mental health. Nearly a third of those worry about money every day. Rather than continue with sleepless nights worrying about their financial issues, many people are turning to reputable debt relief service providers to find the light at the end of a very dark tunnel.
Responsibility, Accountability, and Control
Many factors beyond your control influence your financial health. The rising cost of living, for instance, and salaries that don’t keep up with inflation. However, you don’t need to be a helpless victim stuck in a debt cycle. You can take control of your financial situation and, with a little help, work your way back to financial freedom.
But you must put in the work.
Assess Your Spending
This is actually a very difficult step to take on the road to financial stability. For a start, you have to make the difference between “want” and “need” very clear. You want the chocolate bar, but do you really need it? Chocoholics would say yes, but what if the cost could buy your kids fruit for a week? Now, do you need the chocolate?
Keep your grocery receipts for a month and see where most of your money goes. Inflation and the cost of living are rocketing, but that just means you have to make smarter decisions, which often require a degree of compromise and sacrifice.
Rather than brand-name products, why not buy store-brand products? The quality is about the same, and the savings can be significant. According to recent (2023) research, store brands can be up to 40% cheaper than name brands! That’s a good saving in anyone’s book.
Is Bulk Buying Worth It?
Some financial experts recommend buying products in bulk. For the most part, this is a good idea. However, sometimes buying in bulk is more expensive, especially if stores have really good deals on certain products. Always compare prices before you hop in the car.
Bear in mind that if you buy several products in bulk this month, they’ll probably run out at the same time, which means another big shop in a few months, but this time without the special prices.
Once again, this is where want differs from need. You need toilet paper, but do you really need three months’ worth of cake mix?
Get out your slips and receipts again, print some recent bank statements, get yourself some magic markers, and some coffee, and sit down to do some serious work because you’re going to come up with a payment strategy.
Mark all your automatic payments or recurring financial obligations, like rent and utility bills. Then list them from most important to least important. Car payments, for example, might be high on the list, but payments to a store account might be towards the bottom.
You might also want to categorize them by cost. If your store account is through the roof, but your credit card balance is manageable, maybe look at shedding that store debt first and then consider closing the account.
If you have trouble deciding what expense trumps another, find a trusted debt resolution company to help you prioritize bills in a way that will get you out of financial difficulty with the least stress.
Planning and Budgeting
Planning and budgeting go hand in hand. They’re also best done with the help of a financial advisor. The great thing is that financial advice doesn’t need to cost an arm and a leg. Many banks have free services, and many debt settlement companies offer an obligation-free consultation.
When you’re creating your financial plan, it’s a good idea to deal with one problem at a time. It can be overwhelming to settle your student loan and credit card debt and address your low income simultaneously. You could spread your plan across all financial challenges if you choose, but it’s far better to devise an action plan for each one individually.
The next step is to commit to and implement a solution. For example, it might make financial sense to sell your SUV and use the money as a down payment on a small family car. Your monthly payments will decrease, the interest will decrease, your insurance premiums will decrease, and you’ll get better fuel economy.
A financial plan is great, but it’s worthless if you don’t have the budget for it. This is another area where debt settlement programs might be advantageous. You and your financial counselor can weigh all sources of income against all monthly expenses to get a benchmark for your financial health.
You can then identify opportunities to reduce unnecessary spending and redirect the savings to where they’re needed most. For example, eliminating takeout and cooking bulk meals that you can freeze for later could save a couple hundred dollars a month. Add that to your usual credit card payments, and you could see your debt dwindle.
Your budget should also make provision for an emergency fund. An emergency fund is one of those things that is needed, not merely wanted. You must have a cushion to cope with unexpected expenses, like a medical emergency. Without a cushion, the expense will hit your bank balance hard, and you’ll have to scramble to pay the bill.
Your advisor will help you calculate how much you should put into your emergency fund every month. Add it to your budget, and you might be surprised at the relief you feel now that the risk of a costly emergency is no longer hanging overhead.
Debt Relief Counselors Are Worth Their Weight In Gold
Financial problems are terrifying, and financial stress is debilitating. However, you don’t need to face the challenge alone. Alleviate Financial Solutions is an accredited debt relief specialist. Our experts take on your debt and help you face your financial worries head-on. With our advice and your commitment, your money troubles could be a thing of the past.