Assess the situation
Panic won't help you find your way out - it will only increase stress. So sit down and think carefully about your position. Determine the cause of financial stress. Perhaps it is obvious: for example, you lost your job or went on maternity leave.
But it may be so: you notice that income is regularly not enough, you often have to borrow money. The prerequisites may be different: lately, a lot of money has been spent on treatment, you have accumulated credit card debts, and now payments are eating up all your income, you have spent a significant amount on a large purchase or entertainment. It is important to understand the reason and make plans based on the specific situation.
Identify priority spending
Usually, these are expenses related to housing and food. You can live without home Internet and some entertainment, but you definitely can't do without a roof over your head and food. You can cut costs on some foods, but avoid skipping meals in order to save even more money. You won't be able to work or make wise decisions if you have an empty stomach.
Priority costs may also include medications, daycare fees, or something else, depending on your situation.
Now insure yourself against unnecessary expenses. If you have a credit card, take it out of your wallet and leave it at home. Remove payment card data from apps and online stores. Pay in cash, trying to meet the planned amount. This won't solve the problem, but it will stop the leak.
Read also: Family Budgeting Mistakes and How to Avoid Them.
Make a realistic budget.
Without it, you seem to be trying to navigate in a dark room by touch. By making a budget, you turn on the lights in the room. Now that the route is visible, you won't trip over furniture or step on a cat. The budget will guide your financial decisions and help you resolve difficulties faster.
To keep it realistic, track your expenses 2-4 weeks in advance. Record every purchase in an app or notebook. If you already track spending, flip through the entries for the last months. See how much is spent on different payments and purchases. Think about what you can save on now, what to refuse.
Calculate how much you can allocate to pay off debts, loans or create a reserve fund.
Set realistic goals. It’s unlikely that you will be able to give up a whole category of expenses or save a lot of money on one thing. Instead, try trimming each category by at least 10%. You won't see much difference, but you will save some money. Entertainment, shopping for pleasure, food outside the home can be reduced further - up to 90%. Try to leave a little for these expenses to prevent feeling entirely joyless.
Find out if there are benefits and benefits for you.
In cases of difficult life situations, the state provides social support. Don't dismiss this option. Even if the amount is small, it still does not hurt.
- If you have lost your job and cannot find a new one, join the exchange. You will receive unemployment benefits, you will be able to take free training courses, and perhaps even find a new place.
- If you have a baby, you are entitled to benefits Childbirth allowance in 2019 at birth, allowanceMaternity benefits for pregnancy and childbirth, and benefits childcare allowance for a child under 1.5 years old in 2019for care. If this is the second child, you also have what you need to know about maternity (family) capital material capital. There are additional benefits for families with many children benefits, payments, and benefits for families with children.
- If the reason for your financial difficulties is illness or injury, you can get benefits federal Law of December 29, 2006, N 255-FZ "On compulsory social insurance in case of temporary disability and connection with motherhood" for temporary disability. It is also charged for caring for a sick child or family member. You can also reimburse part of the treatment costs by receiving a tax deduction social deduction for expenses for treatment and purchase of medicines...
Try to negotiate late payments.
If you realize that you will not pay utility bills, medical bills, or interest on a loan shortly, contact the organization to which you should pay as soon as possible. They will likely agree to make concessions: it is more profitable for them to receive a smaller amount than nothing at all.
Also read: What to do When You Have Financial Problems
Banks can lower the interest rate or postpone the payment without charging a penalty (usually no more than 1-3 months). Management companies may agree to waive utility bills temporarily. The main thing is not to wait when you owe a lot, but to agree in advance. Otherwise, it's unlikely that you'll get a fair deal. And be prepared to collect the necessary documents to confirm that you are in a tough financial situation right now.
Take small steps
It seems doubtful that it will be possible to return to financial stability in a few weeks or even months. Move gradually: lower expectations, defer regularly and look for ways to increase income.
If on a certain day or month you go over budget, don't start berating yourself right away.
Analyze spending and find the reason for unplanned expenses. Perhaps your door lock has broken, or your glasses have broken, and a replacement was urgently needed. Or maybe you succumbed to temptation in your favorite store and bought something unnecessary. In the second case, try to change your behavior to protect yourself from similar expenses in the future.
And don't despair. Keep in mind that these limitations are just temporary, and you only need to be patient until your financial situation improves.
Adapted and translated by The Cop Cart Staff
Sources: Life hacker
