Here’s how to get the financial stability you’ve been waiting for and get rid of debt once and for all!
Having financial stability is more than just having your budget in order. By having good financial stability, you can look forward to the future with peace of mind.
In addition to having accounts that close at the end of the month, financial stability is also about building equity, security and achieving dreams.
For some people, financial stability is not the easiest task to achieve, but with a few tips, you’ll wish you had started sooner. That famous financial stability can be achieved with discipline and goals you need to know about.
1. Plan your budget
To chart a course to financial stability, you need to plan your budget, which involves having a detailed knowledge of all your income and outgoings. Once you have information on all your expenses, it becomes easier to organize yourself to spend more efficiently.
For example, if you realize that a good portion of your expenses are concentrated in dining out, it’s time to rethink your habits and start eating more at home to optimize your spending.
Plan all your purchases, research prices and avoid impulse buying. If these steps are not followed, your financial stability will be seriously compromised.
A simple example: many sites offer private sales, I bought on this site and after a few months I realized that I often looked at their newsletter by email to know the new products on sale. These made me addicted, but I managed to detach myself and take advantage of this.
At first, it’s always the same sales. You think you missed a sweater, don’t worry; in a few weeks it will be back on sale (sales are not limited; these have agreements with brands).
I’m not saying to buy from this site, but do some research on these brands before heating up the credit card. Or buy from brands you know and the prices too.
Most professionals have a fixed income, since they receive a salary. However, in some cases, it is common for these values to vary, for example, in the case of sales or commercial employees or freelancers.
So, understanding your income and the possibilities you might have in relation to it are also essential for you to plan your budget.
2. Involve the family
As you begin to plan, you will see that there are better ways to spend your money, and that they are the budget cuts needed, either to live within your standard of living, or to direct the money to pay off some of your debt.
And for this adjustment to be done properly, everyone must be involved so that the change in attitude is widespread. And remember: even if you end the month with zero to zero, it’s not necessarily a sign of good financial health.
In this case, if there is no creation of a financial reserve, you should review your spending so that there is the remainder to be used for building up that balance.
To reduce expenses and align your finances, you definitely need to involve your family to build financial stability. Credit needs to disappear / the number of credits needs to be reduced in your couple.
Talk to your entire family, including children, and explain objectively and simply what you intend to do for the future and how everyone’s participation is essential. It is important that everyone is aware of the situation so that the adjustment is equally shared by all.
To make adjustments, cut back on small expenses, do market research, less restaurant and mall visits to meals on wheels that will not only unify your family, but will save resources, one of the pillars of financial stability.
During our financial difficulties, we went from over 2 restaurants a week to zero. At first it was difficult, but the results are there. These savings allowed us to have an extra week of vacation abroad (including restaurants).
With everyone in the family committed to financial success, the mission of achieving financial stability will be much easier for everyone.
3. Exchange the most expensive debts
If your finances are in disarray and in debt, try to pay off the most expensive debts, those that require higher interest rates, such as credit cards and overdrafts.
Overdrafts are not meant to last, as they cost more than credit. Banks are happy with overdrafts: high repayment rates and extra commission fees.
Overdrafts are not meant to last, so if your debts are prolonged, it is urgent to remove them first.
Keep a close eye on your direct debits: usually, different bills draw on your accounts over the same period of time, so keep an eye on your accounts to avoid unnecessary overdraft and therefore unnecessary and inconvenient fees.
Always have a financial reserve for your direct debits.
In the beginning, always try to keep them up to date, always looking at your expenses to see where you can cut them so that you can pay them.
If these sacrifices are not enough to pay the obligations, go to your lender and look for a good negotiation for you and for them.
In the latter case, if none of this has worked, take out another loan with lower interest rates, with the goal of taking on all your debts and taking the first step towards financial stability.
Be aware, you must use the money only to end your debts and not for new purchases.
A good tip for this is to use a financial simulator to check your financial situation. You need to assess your financial situation so that credit is no longer a problem for you. An extension of credits is not intended to ensure a financial balance.
4. Define possible goals
Even if the values are considered low, focus on creating and maintaining a financial reserve, because in the long run, this discipline will ensure that the amount reaches significant values.
As you plan your budget, you can set a goal, for example, a percentage of your gross salary, which should be separated upon receipt to avoid the temptation to spend it.
Consider this amount as a monthly expense and don’t count on it for bill payments, so it’s easier to track your monthly savings goal.
Save at the beginning, not at the end. We are told to do the opposite, but this is a big mistake. We save first, then expenses and evaluate the rest of our budget.
5. Apply your money wisely
Once you get organized and start building a financial reserve, it’s still important to invest your money so that it’s safely stored and you can grow your reserve with the interest generated from these small methods
For many people, when we talk about saving money, the savings account is the first one that comes to mind. Although it is a very safe savings account, it is no longer an interesting alternative, since it yields less than inflation.
Thus, the investments made in this modality have nominal gains, but end up losing in real value.
A more suitable alternative is fixed income funds, which have a low risk, perhaps an interesting option.
In this case, you should watch the administration fee charged by your bank, which should not exceed 1.5%. In addition, the regressive income tax makes this application more interesting if you leave your money applied longer.
The higher the value you invest and the lower the financial institution, the greater the profitability offered.
You can also invest in Treasury bonds.
In order to achieve the much desired financial stability, you need planning and involvement of your family. In addition, you need to start earning a portion of your income to apply, which must be done intelligently and, if possible, diversified.
And, you want to know how to control your budget and invest in your dreams? Click here and find out how to optimize your home budget.