Most people experience financial stress at some point in their lives. But, when your spending habits are consistently putting you in a position of being strapped for cash, it’s time to start rethinking some things. There are many ways to get yourself back on track. Some of them involve personal decisions, while others require professional intervention.
In this article, we take a look at all the different ways you can help seek help for your bad personal spending habits.
Gauge Where You At
Naturally, bad spending habits exist on a spectrum. There are people who have a few too many streaming subscriptions and there are others whose paychecks get wiped out by their credit card bill every month.
The severity of your problem should inform your next steps. There will be tips below for people on all sides of the issue. However, if you feel that you are suffering from an addiction to shopping (yes, this is real) this article should not be considered a substitution for professional help.
Make a Budget
Unless you are in the highest income bracket, you probably should have a budget that accounts for household expenses, incidentals (an unexpected repair, or hospital bill) and entertainment. You can make a budget yourself, using recommended spending breakdowns.
There are applications available that can help with this. Depending on the situation, you may also wish to consult the services of a financial advisor. It may feel ironic or even unwise to spend more money when you are trying to cut back, but there are benefits to pursuing this route.
Unlike a phone app, your financial advisor can help you set a budget that better aligns with your specific goals. They’ll ask important questions. How do you want to save for retirement? College? Travel?
These granular considerations make an enormous difference, both in the decisions you make, and your overall quality of life.
Pinpoint the Problem Area
It’s easy to make bad financial choices without realizing it. Perhaps your grocery bills are higher than they need to be because you buy brand names instead of the more affordable knockoffs. Or maybe you eat out a time or two more often than is necessary.
You can get a better idea of where you are going wrong by taking a close look at the debits on your credit card statements. Take a close look at each problem area, and find out if there is a more affordable alternative available. Everyone has areas where they can trim back. Identify yours and see if it makes a difference on your overall finances.
Avoid Credit Cards
Credit cards certainly have their purpose, but if you’re struggling to control your spending habits, the “buy now, pay later” approach may not be right for you. While it may be a decent idea to maintain a credit card in case of emergency, try to put it somewhere out of reach so you won’t be tempted to use it frivolously.
Paying with cash or debit makes it easier to understand the true state of your finances. It also helps you avoid interest.
Consider Professional Help
The phrase “retail therapy” is often used off-handedly as a joke. Something unpleasant going on in your life? Shop till you drop in a fit of retail therapy and leave your troubles behind.
But for some people, a different brand of retail therapy is in order. If you find that taking a more hands-on approach to your budget isn’t enough to fix your problem you may consider the services of a financial therapist.
Again, we find ourselves in the position of recommending that you spend money to save it. Like the financial advisor, however, the financial therapist can make a significant impact on your spending habits.
Financial therapy basically combines the roles of an accountant and a therapist into one package. Patients go in for financial recommendations, but while they are there, they also receive emotional counseling.
Financial difficulties are one the leading sources of stress in the United States. It’s been this way for a long time, but Covid-19 only exacerbated the problem, resulting in unprecedently high levels of layoffs.
It’s easier to get work now, but with inflation and a recession looming, financial stress isn’t so hard to come by.
If you feel overwhelmed by your financial situation, or simply emotionally unable to advise yourself on what steps to take next, consider the services of a financial therapist for your mental and fiscal needs.
Government Aid
Everyone needs a hand up from time to time. If your situation has gotten bad enough that you are struggling to pay bills, or buy food and clothes, consider reaching out for extra assistance. Government programs can help with everything from home payments to buying groceries.
Not only can outside help empower you to meet your needs, but it can also help give you momentum in your journey towards financial recovery. It’s very difficult to experience upward mobility when you are only just scraping by. Consider taking advantage of all the support you can get to help put all your financial ducks back in a row.