If you are struggling to make ends meet financially, you are pretty much where I was 10 years ago. I’d never had a job, I was a school dropout who’d walked out on my degree and I had nothing to show for my life except excessive student loans and an addiction to pizza. I was struggling hard and on benefits until I eventually found myself a job in the care industry, then later marketing, then I started my own company and my life began. Four years later, I’ve mastered my life financially and I’ve started working properly, learning to discipline myself when it comes to making financial decisions.
Treat this article like an exercise and get a piece of paper. Over the next month, every time you are going to spend money in these following areas and you stop yourself, make a note of how much you saved and look at it at the end of the month.
1: Never buy anything on finance. Finance is an absolute nightmare that does incredible damage to many low income families. The problem with the culture of today is everyone wants everything now and they don’t take into account the issues that can occur if they have to constantly pay out monthly for things. Kids want everything now, computers, iPads, phones, and as adults at times we are no better! I have bought many things on finance, and it’s always ended up terribly for me, with me struggling hard to get extra income in.
A mobile contract is sensible, as a phone can be used for business and it’s a great asset to your life, however I have seen some of the incredible damage done by getting items on finance. Once you have outgoing amounts every month, this is a direct counter against your income. Usually you will have council tax, electricity and gas, mobile payments and food in your outgoings along with a few other things. Measuring that against your incoming amounts, you will still have money coming in each month.
Now imagine you want a shiny new 4K TV, Computer, Sofa, Cooker and Fridge and now they’re all adding to your outgoings. This is going to increase your financial stress and push you into the danger zone very quickly if you are not careful. I have seen catastrophic damage from families taking on too many of these small financial commitments, and over time they take a lot more than the items would normally cost as well. Each item is a mini loan, and with too many of the combined they can destroy you!
The best way to deal with this problem is to avoid paying on finance for anything you don’t immediately need. Save up for them instead.
2: Never take out or guarantor a loan. Many years ago I was the guarantor for a loan for someone. This was for just over £2000.00 and when that someone decided to disappear like a wraith in the night, I was left to pay it off as quickly as I could. Overall it cost me £6300.00 to pay off, but if I hadn’t done it in such a timely manner, it’d have been £9800.00 in 5 years. This is an absolute nightmare no human being should ever be part of.
It doesn’t matter how desperate things get, I can never recommend a loan. Don’t guarantor one for a friend, you can easily take them in instead, provide advice and support and help them. You need to be careful. Protect yourself, protect your family. I was working 80 plus hours a week to pay it back which broke me.
3: Cut back on things you don’t need. Having struggled financially in the past, there have been times when I was unable to afford luxuries in my life, cans of coke, cigarettes, and takeaway meals. Think to yourself: Do I really need this? The majority of the time for little luxuries here and don’t need them, even though they do feel nice. I used to justify takeaway meals and say: “I can earn more in the time I spend cooking than I will spend on this takeaway.”
Well, I could get a packet of noodles, put them on for 5 minutes as I write and then get back to work whilst they cook. In hard times I have cut down on things I don’t need and have saved myself hundreds per month. Though I do miss the dramatic eyeliner days of my wayward youth!
4: Home is where the holiday is: I have seen so many times on Facebook that my friends who are struggling with money troubles are going on holiday… Taking flights, expensive cocktails, elephant rides, playing with penguins, cool shades? Despite the fact they have the latest iPhone and iPad (on contract) on which they could look up a beautiful picture of a peaceful blue lagoon, they go out to the tropics and get bitten by mosquitos, catch malaria and get mauled by bears.
If I said a holiday for me would be cheap at £300.00 and went one one cheap holiday a year for 10 years, I’d just be as happy at the end of it with £3000.00 more if I didn’t go. Keep holiday costs minimal by staying at home or by going on holiday locally.
5: Punish Yourself! This is the greatest tool in my arsenal of self defence when it comes to stupid purchases, and believe me, in my life I’ve made a lot! Every time you want to buy something that you don’t need, put the money in a bank account you cannot access instead. This will save you if things get tricky and has for me on three occasions. I’ve gone without computer games, kebabs, and much more and now I’m saving up for a house quite comfortably. I live a more meagre and slightly more boring and miserable life, but it’s a safer life, reducing my stress, and with that level of calm, I’m able to handle just about everything I do a lot easier.
I hope this helps!
