Are you your biggest obstacle in regaining control of your finances and restoring your credit? Unexpected expenses are likely to come up in life. As they say, life happens. But if your spending based on emotion, like choosing a more expensive bedroom set than necessary or buying a brand new 70″ TV when your old one works just fine—you may be your own worst enemy when it comes to finances. In order to regain financial control, you have to first analyze your own behavior and attitude. Once you take responsibility for your purchases, then you can begin to regain control.
Create Plans and Goals–Setting a long term plan and goals is kind of like an author writing an outline for a story, it keeps the story flowing. Without it, there may be no clear direction to where the story is going. The same rings true for your finances.
Prepare for Emergencies–Back to what we were saying before—life happens: people get sick, roofs leak, cars break down. Credit cards are good to have in emergencies but you don’t want to rely on them (that’s usually how we get into trouble in the first place). It’s a much better and safer idea to create an emergency fund. Your best bet is to start with $1,000 and try to up it to 3-6 months worth of income. Go up from there when you can. Having that buffer zone will make you feel much more relieved should the unpredictable happen.
Spend Less Than You Earn–This is such a simple concept yet somewhat difficult to put into practice. Establishing a monthly budget is the key. Create a budget for the upcoming month, then layout your expected income and expenses on paper, so you know exactly where your money is going. Once you run out of money for that expense, don’t spend anymore.
The guideline budget below from the book, The World’s Easiest Guide To Finances, provides a suggested percentage of your income to be allocated into 12 different categories.
| Housing | 25-38% |
| Food | 10-15% |
| Auto(s) | 12-15% |
| Insurance | 5% |
| Debts | 5% |
| Entertainment | 5-7% |
| Clothing | 5-6% |
| Savings | 5% |
| Medical | 4-5% |
| Miscellaneous | 5-8% |
| Investments | 8-13% |
| School/Child Care | 5-10% |
Automate Your Savings–It’s best to automate your finances. Have all your bills paid automatically using online bill pay and transfer your savings using online transfer features. Not having to keep track of what bills are paid and which ones are due goes a long way. Take advantage of these services and save yourself time and stress.
Want Something Big? Sleep On It–Don’t impulse buy. If you see something expensive you want, sleep on it. Your perspective on a purchase may be different once you are out of the store and have time to think about it. Evaluate what you want vs. what you need. If you want an expensive purchase, then save for it.
Regaining control takes discipline but it’s certainly within your reach to attain. Keep the big goal in mind. If an unexpected expense occurs, instead of putting more damage on your credit card and spiraling deeper into debt, a better option for you may be to chose a company like LutherSales™. LutherSales, Luxury Made Easy™, is on online retail store that offers brand name quality products, such as furniture, appliances, electronics, handbags, jewelry, and more. Affordable, small installments come out of allotments or direct deposit so you’ll never have to worry about paying on time. No set-up or membership fees. Just stress-free shopping. See what we have to offer at Luthersales.com.
