What to Do When You Have Too Many Bills and Not Enough Income

If you dread opening the mailbox because of monthly bills, it may be time to evaluate your financial situation. Having too many bills and not enough income is a major red flag. It likely means you are exhausting your income which leads to debt. You are jeopardizing yourself even further when you use credit cards to make it from month to month. If this sounds like you, here are a few tips to help put you in the driver’s seat and take control of your personal finances.

What Do You Do When You Have Too Many Bills and Not Enough Income?

Take Control if You Have Too Many Bills and Not Enough Income

Balance Your Books

The first thing you must do it to balance your books to see why you have too many bills and not enough income. Inventory all your bills and outgoing payments within a month. Write it out instead of pulling it from memory to be certain you don’t miss anything as well.

The easiest place to begin is with your monthly statements. It can be overwhelming if you have a lot of bills coming in each month. Break them into smaller categories like utilities, loan, and credit card payments and deal with them one by one. If you tend to forget payments, set up electronic ones online. Then you will never have to worry about late fees or other penalties again.

Review the Monthly Budget

As you are looking over those monthly bills, pay attention to the larger expenses on your credit card statements. This is a great way to review your family’s spending habits and see where all your extra cash is going every month. Those micro-transactions for fast food, coffee, and other daily expenses add up quickly. Enforcing a little self-control and sticking to the budget saves more money than you might think.

Another way to reduce your monthly spending is by getting rid of unnecessary expenses. Eliminate subscriptions, memberships, or services that you are not fully utilizing. You can also look for bundled or packaged services for insurance and telecommunications. Be sure to shop around and compare prices to get the best prices possible.

Eliminate Your Debts

The next step to regain control of your finances to tackle your debts. Contact any lenders or collection agencies where you owe money. Discuss settlement and repayment plans to get you out of the red. Often times, you can negotiate for manageable terms since they are willing to work with you.

If you have considerable credit card debts, you may want to consolidate your debt into a single monthly payment. You can do this with a refinancing loan or go through a debt relief agency to negotiate on your behalf. You will usually get lower interest rates as well.

Increase Your Income

Of course, the easiest way to solve this is to get more income. First, look for opportunities to earn more at your current job. You could pick up extra hours, ask for a raise, or go after a promotion. It is much simpler to increase earnings at a job you already have than to find a new one.

However, if you still have too many bills and not enough income, you may consider a second job. Another option is to search for ways to earn passive income. This could be the perfect time to turn your hobby or services into a small business venture.

No Excuses

Finally, you cannot make excuses for your poor decisions. Avoiding your financial issues won’t solve anything. Furthermore, small issues will easily grow into more serious problems the longer you look away. You must be brutally honest with yourself to get spending habits and debts under control. Rationalizing your behavior is not helpful or beneficial for your financial health.

It takes sacrifice and discipline to reach your financial goals, no one can do the work for you. Most importantly keep a positive outlook and remind yourself that you are capable. You should also find ways to motivate yourself to continue moving towards your ultimate goals. It can be a long and arduous process, but there are ways out of financial hardships towards a more secure future.

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Financial Mistakes to Avoid as a Recent College Grad

 

Mistakes to avoid financially as a recent college grad

Mistakes to avoid financially as a recent college grad

Mistakes are unavoidable, but you should be especially careful when it comes to your finances. As you prepare to graduate college, you also prepare for the “real world.” You’ve spent the last four years obtaining as much knowledge as possible in your field, applying for jobs, and writing your resume. Graduates beware, student loans are the second-highest form of personal debt. And with college debts increasing, it is more important than ever to have a smart financial strategy in place. A solid plan will help you avoid as many mistakes as possible.

By taking a step ahead of your peers in choosing wise investments, you can create healthy habits. This not only improves your personal finances for years to come but also avoid future debt issues.

Financial Mistakes to Avoid after Graduation

Financial mistakes can be easy to make, but there are ways you can avoid them.

Mistake #1: Having no credit.

Everyone talks about saving money, and we are no different. Unfortunately, all this talk about savings has college graduates a little hesitant to take out loans or credit cards. This is due to the fear of creating an overwhelming debt they can’t repay. Plus, not to mention, college already creates heavy financial obligations. Furthermore, it is increasingly harder for those under 21 to sign up for a credit card with no existing income. So, what’s a newbie to do? Build your credit history slowly and regularly by opening accounts and using your own credit cards.  Making consistent payments by or before the due dates establishes a good credit history.

Why this is important: When you want to make big, future purchases, like a house, you will have a hard time being approved for a loan. Lenders may require a co-signer or collateral if you have no credit. When I was still in college, I bought my first car with cash I had saved from my summer job. Not long after graduating, I needed to purchase a new vehicle. This proved to be a challenge due to my lack of credit. Over the years, I have been able to develop a favorable credit score by paying off a credit card and the loan for my vehicle. Had I started to build credit sooner, I wouldn’t have struggled so much to get the car I needed.

Mistake #2: Not having a plan.

Having a limited or non-existent financial plan is one of the biggest mistakes recent college grads make. As a poor college student, you are lucky if you have two pennies to rub together as you battle the choice of groceries or rent. When you land that first job out of school though, it can be easy to fall into poor spending patterns very quickly. To avoid this, cut back on unnecessary expenses like going out to eat.  Spend more time enhancing your cooking skills and spreading out your personal purchases. Instead of buying everything for your new apartment at once, budget your expenses over time. Additionally, focus on always paying bills first at the beginning of every month. Then, you know how much is still available in your accounts to last the rest of the month.

Why this is important: Money adds up quickly. So, developing these positive habits sooner can save you not only hundreds but possibly thousands per year.

Mistake #3: Waiting to save and worrying about finances later.

Consider consulting with or finding a financial mentor to help you along this new journey. Waiting to save or pay off student loan debt can cause major inconveniences in your future. Knowing where to invest savings is also tricky, but a certified financial specialist can help you. Try the Digit.co app to automatically save up and pay debts and also try to contact friends from college with a finance degree who may be willing to provide some advice at no charge as they begin their careers.

Why this is important: The sooner you start paying down those student loan bills, the better your overall financial situation. If you were to plug your debt numbers into this student loan calculator tool, you may be appalled at the time frame it will take you to pay it all off. The minimum monthly payments barely cover the interest. Plus, creating a savings account and emergency fund will keep you out of sticky financial situations.

Mistake #4: Not investing early.

Time is the greatest benefit you can give yourself when it comes to investing. Even if you are only contributing a few hundred dollars each year, compounding interest rapidly grows your investments over time. Instead of blowing any extra cash you receive, put it away to help provide some financial security for the future. Try the Robinhood app for this, this is the best app for beginner investors like you.

Why this is important: You are only working against yourself the longer you wait to start investing and planning for retirement. Even with minimal contributions, you can create a significant amount of money the earlier you begin. With a little forethought, you can provide a security net and a nice retirement fund.

By thinking about your future now, you can avoid these common financial mistakes recent college grads make. At the same time, you are also building yourself a nice, comfortable financial safety net.

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The Irrationality of Panic-Buying

The Cost of Panic-Buying

The first week of February marked a distinct change in the shopping habits of consumers across Southeast Asia. Following the Lunar New Year, everyone was on high alert as Covid-19 spread beyond the Chinese borders. Here in Taiwan, the first cases led to school closures, increased doctors’ visits, and families preparing for the worst. In addition, masses of people were ‘panic-buying’ health care products and household supplies.

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