Did 2014 prove to be a very challenging time for you and your finances? Were you disappointed in yourself for not saving enough or overspending? While we may have a vision for how we saw the year going, financially-speaking that is, perhaps this didn’t end up going as smoothly as we had hoped. It’s important for us to realize where we may have gone wrong so we can start to get on the right financial track.
However, as the expression goes – ‘out with the old, in with the new’ – as opposed to feeling down on yourself, why not try and stay positive and look to the future instead. As you think ahead to how you envision your year going, try to focus on taking steps to improve your finances moving forward.
So just how will you turn over this new leaf?? Here are some tips to help get yourself more focused on making some finances changes in 2015.
1) Be Honest (With Yourself and with Others)
First and foremost, in order to make a change you need to acknowledge that there is a reason for concern. If you have already realized yourself, that you have some financial issues, then letting others know about them, can help alleviate the stress you may be internalizing about this personal hardship. Some times this person may be a friend or a family member or even a financial advisor. Asking for help from a professional can be a great first step, as they can help you tackle this situation and work towards a manageable solution.
2) Cutback on Certain Expenses
Budgeting, is of course an effective method of balancing your incoming and outgoing money. This task can also help you to identify areas where you may be able to cut back on your spending. It may be that you are paying for things that are unnecessary expenses or expenses that can be at the very least, minimized. More specifically, are there items and services you are currently paying for that you can completely cut out? and/or are there expenses that you can purchase at alternative sources that may cost less? Either way, this is a very good way to free up some extra money.
3) Prioritize your Debts
I have come to know that there are no perfect solutions for identifying which debt should be paid off first – rather a range of options that may make more sense to different people, as well as at different points in your life. For example, sometimes it is best to pay off the debt with the most costly interest charge/the most expensive debt, while other times paying off many smaller debts all at once can be more effective. Ultimately, what I think is most important is to look at your unique set of debts and see if there are any where you may be at risk of missing a payment or falling further behind in your payments. This may be the larger debt or the debt with the highest interest – so overall you will need to examine your own debt and make a plan for yourself that is based on ridding yourself of the source of debt that is the most urgent or has the power to be the most financially damaging.
4) Consider Debt Consolidation
Debt consolidation may also be an efficient method of helping you lessen your debt, as well as at a much faster rate. If you can secure a loan at a lower interest rate, by combing all of your debts into one, this could be an extremely helpful step that can improve your finances for the upcoming year. Debt consolidation can be especially effective when you have multiple credit cards that you are struggling to pay off. However, it can also be used for other types of debt and turning to a debt consolidation or debt-relief specialist may well be worth exploring as the new year nears. Perhaps, debt consolidation or other forms of debt management may be the best course of action for you at this time, either way, examining your financial options can certainly be something to consider as you aim to turn things around for the upcoming year.
5) Stay Positive
While this final point may seem very obvious, I truly believe that in order to be successful in all aspects of our lives, we need to have a positive attitude. Being positive can help us to stay motivated and as many of us know – motivation is key to staying on track with our finances. This ‘mind over matter’ perspective can prevent us from giving up when something seems hopeless. While not every strategy will be effective for every individual, the important thing seems to be to try and remember is that even if we try something and it doesn’t work, as long as we remain motivated and have a positive outlook, we can seek out other methods of accomplishing the personal goals we have set for ourselves.
I also try to keep attuned to this way of thinking in many aspects of my life. Ultimately, if one plan fails, you reassess the situation and come up with another one. With regards to debt, there are plenty of solutions that can help you combat yours – and if your goal is to improve your debt in 2015, knowing that you CAN do it, is half the battle.
