You’re struggling to make ends meet. The bills are piling up and you feel like you’re falling down a hole. If this sounds familiar, take solace in the fact that there are ways to get out of this cycle. Maybe now is the time to try. Here are a few tips to get you on the right track:
1. Start by realizing this is a temporary situation. Most of us feel like we’re in a downward spiral and it’s hard to see the end of it. But this is not permanent. Things will eventually get better, you’ll see, so don’t feel discouraged if things aren’t working right now.
2. Evaluate your money habits by taking stock of your income, expenses and earnings, then comparing them with what you already have saved up or owe, every month over a period of time (a year or more). You may find that you’re not making enough or spending too much, which is why you need to recalculate your expenses and income.
3. Stop running up debt. If you already have a ton of credit card debt, calling your creditors and asking for a reduction in your payments or even better a settlement might help boost your financial position. Don’t be afraid to talk with creditors as they understand people are in bad situations and are more willing to work with those who are willing to make amends.
4. Cut back on unnecessary expenses by first looking at non-essential spending habits (e.g., cable TV, that once-a-week night out).
5. Put more money away in savings. If you don’t have much savings, it’s never too late to start saving and building it back up slowly. If you already have a decent amount of cash saved up, try to divert more income into your emergency fund or retirement/401k plans.
6. Start making extra income by asking for a raise or asking for part-time work with another employer. Remember this is temporary so there is no shame in having to ask for help when it comes time to make some extra dollars.
It’s important to realize that there is no shame in asking for help or making some extra money. If you are unable to get out of a downward spiral and break the cycle by yourself, ask for help from family, friends and/or hiring a financial advisor to give you advice that will get you back on track.