At some point in our lives, we will all be subjected to a degree of financial stress. Whether it be due to money mismanagement, or even due to being the victim of a broker scam, finances can be a roller coaster throughout our lives. Dealing with financial stress correctly is the key to avoiding any more financial problems, and also taking the steps necessary to being in a more financially beneficial position. In this blog, we will share the steps to take if you have hit financial rock bottom leading to stress. Take a look at the following suggestions:
Table of Contents
Map out your current spending habits
Firstly, you need to determine what got you into the current stressful position. What are your financial sources of income, and where are these resources going out to? We would recommend getting at least 3 months’ worth of bank statements from all active cards and looking out for any recurring patterns. Group each cost, for example, food, transport, bills, leisure etc. Where are you spending the most, and what cuts can be made? These cuts need to be realistic. For example, if you can save £100 a month getting the bus instead of driving, this would be a credible option.
Collate any high-interest-rate debts
Debt is often the most prevalent source of financial stress. Once you get yourself into debt, it can feel like a never-ending cycle to get yourself out of it. Gather all of your existing credit agreements, and figure out the number that you owe in total. In some cases, you may be paying too much interest, and you may be eligible for a lower interest rate. There is no harm in getting in touch with your lender to see if any adjustments can be made to reduce your monthly interest on repayments.
Start an emergency fund
Hopefully, by now you have a clearer picture of what your outgoings are, new budgets, and also a clear view of what debts you need to repay. Emergency funds are also important at this stage, to lay a safety net in case you find yourself hitting financial rock bottom in future. Start putting away a small amount of money each month.
Speak with your bank
Sometimes, speaking with your bank can be helpful if you are looking for more tailored advice. As an organization that can see all of your spending habits, they might be able to offer support as to how they can help you save more, and also protect your finances. Banks also offer bespoke plans to help individuals save for first homes and also offer loans to help people invest in their businesses. Be sure that your bank is reputable first, as there are a range of revolute scam refunds taking place as a result of fraudulent banking.
Create a new stream of income
If you need an extra boost in finances, it would be a good idea to create an extra stream of income. There are some options to consider, from starting an online side hustle to day trading there are lots of ways to add some extra pennies to your pocket.
Bottom line
Overall, financial stress is manageable with the right action. Be sure to take control of your outgoings, and redirect where your money is going to reduce any unnecessary debts.
