Enjoy this guest post by Savannah Hemmings, a personal stylist and lifestyle blogger who blogs at Sincerely Savannah.
Financial stress has hit all of us at some point in our lives. Whether you are wondering how your paycheck will get you through the rest of the month or you’re considering taking a second job to keep up with bills, the burden that finances can cause is very real.
It’s important you’re able to recognize the red flags that pop up as you spend and receive money. You can learn to be diligent and thrifty with your earnings before you stumble down the road that leads to loads of debt.
Check out these five signs that your finances are in trouble and how to fix them:
- You end up paying a lot of overdraft fees.
Those overdraft fees can be easy to ignore, but you really shouldn’t! It means you don’t know how much money you have in your bank account. It also means you are using your debit card like crazy without even thinking about it.
So how can you fix this problem? Check your bank account regularly. Make it a routine to know how much is in your account, and then spend less than that amount — never spend more than that amount.
Just to get a feel for how much money you spend in a given amount of time, take out what you estimate you’ll need in cash for a week. Then, spend only that cash. You’ll get a better sense of exactly how much you’re spending and on what.
- You put off paying bills as long as you can.
Even though they never go away, sometimes piling up bills and statements and “forgetting” to open them can make them disappear from your mind. This is a sign that paying these bills makes you anxious. It could mean you don’t have enough money to pay them, and you’re going into debt.
Ignoring bills is not the solution to this problem. You need to find a way to pay them because you will only go deeper into debt if you don’t. Pick up the phone and call your credit card company or lenders and explain the situation you’re in. More often than not, they will try to work with you to make your payments more affordable. Consolidating bills or combining insurance policies are also options to get lower payments.
- You ask other people for money.
If you are asking friends and family to loan you the money you need, then you are probably in financial trouble. Borrowing money from family and friends could be a huge mistake. First of all, you will constantly feel indebted to them. You don’t want that strain on your relationship.
Instead of asking your loved ones or friends for money, pick their brains for advice. They may have faced a similar situation and their unique perspective could be priceless. Ask them to help you be financially accountable.
- Your savings account is at zero.
If you are living paycheck to paycheck, you might think a savings account is something you can’t afford. However, it’s actually something you need to be able to afford. Emergencies are inevitable, and putting money aside for when those emergencies strike is just a wise thing to do.
Save up several thousand dollars. You can start small. Make room in your budget for a small amount of money to be put aside each paycheck. It doesn’t have to be much, but tell yourself that money can’t be touched unless it’s an emergency.
- You are fighting over money with your spouse
You will inevitably fight over money with your spouse. Every married couple has some kind of disagreement when it comes to finances. The question is, how often does this fight occur? Is it over the same issue every time? If you are constantly fighting over financial matters, it’s a definitely a red flag.
The first thing you need to do to solve this issue is to create a budget and stick to it. Make sure you both agree with the spending you plan out. Sit down each month and go through each expense. If you keep each other informed, you will have more peace in your house and a better understanding of your finances.
You can still recover from debt and stop living paycheck to paycheck. It just takes hard work and some persistence. How do you fix the financial red flags in your life?
What do you think of these tips?