Living within our means is something which we should try hard to do. It will mean that we will not need to get a loan just to manage and we will feel more secure knowing that we can afford everything that we need. However, many people find it really hard to do this. There are things that we can do though which can make it a lot easier.
- Stick to a budget – the first step is to set up a budget and make sure that you stick to it. You will need to start by making yourself aware of how much money you have coming in each month. You should be able to find this out by looking at your bank statements. The amount can vary and this can make it slightly more difficult. However, it can best to assume the lowest possible amount is what you will be paid and then anything else will be a bonus. If you stick to a budget that will be in line with the minimum pay then you will not risk not having enough money to pay for everything that you need.
Once you have done this you will need to make sure that you work out what you have to pay for and whether you have enough to cover it. By breaking down spending into essential and luxury items you will be able to work out whether you are able to cut back in some area sin order to more easily manage the essentials that you will need to pay for. It is not fun, thinking about cutting back spending, especially as you will have to keep paying for the annoying and dull things like water and tax but cut back on the fun things like evenings out and alcohol. However, if you want to be able to live within your means you will need to do this. You must pay for those essentials or else you will have your utilities cut off and could find yourself without a home, but you will be able to manage without the luxuries. You could find that you will be able to manage some luxuries anyway especially if you compare prices carefully on everything you are buying and make sure that you are not paying out more than necessary.
- Pay off loans – if we have loans, then paying them off can really help us in the long term. It can be hard to imagine that if you are struggling to make ends meet that paying off a loan will help, but it will. This is because you will no longer have to pay interest on that loan and so you will reduce the amount of money that you will have to pay out and you will be able to use that for other things. When we take out loans, we often forget to check whether we can afford the repayments. Repaying them is important and if we miss repayments then we will get additional charges which is not ideal. So, paying off what we have and then making sure that we can afford any that we take out is really important and will help us to make sure that we are living within our means.
- Save Money – having some savings behind us can make a big difference to how secure we feel and how able we are to pay for everything that we want. If we have that money behind us we will know that is there is a situation where we are struggling then we will have something to fall back on. There is a good feeling about knowing that you have this security. It is wise to pay off bad credit payday loans first though as they will be costing you money and once you eliminate them you will be able to start putting some money away as savings and build them up a bit.
It will take time to change your spending habits and sort out your financial situation. Therefore, it is important to make sure that you stay motivated. Write down your goal so that you are aware of the reasons why you are budgeting like this and this should help you, Keep that note somewhere that you look at regularly so that if you feel deprived or that you are not getting very far, you will be able to read it and remind yourself that it will be worth it. Sticking to it will be the hardest thing, particularly when you have temptations, an expensive time of year or something like that. If you do struggle and find that you slip up a bit do not be hard on yourself, you are only human. Just take check, realise what went wrong and start again, learn from the experience so you do not make the same mistake in the future.