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Don’t Spend More Than You Have!

Even though the economy is supposedly doing better, most American’s are thirty to ninety days away from not meeting their financial needs to pay bills. Succeeding in your finances is important for your mental and physical health as well as your future. If you don’t feel as though your finances are in order you could:

• Lose sleep,
• Become extremely stressed,
• Unnecessarily panic during emergency situations,
• Develop anxiety disorders,
• Be depressed,
• In other words, go to your doctor to see if he can give you a prescription for a “Financial Stress Reliever

The key to financial success is to be disciplined in your personal investments and savings. Be educated and know where your money is going. Here are five tips, tricks, and techniques to help you regain your control over your financial status.

#1) Build a Three to Six Month Emergency Fund

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This will keep you from building up credit card debt when an emergency strikes (doctor’s appointments, loss of income, etc.) A three to six month buffer will help keep you and your family financially secure when the going gets rough; however, 12 months would be ideal.

#2) Look at Where You Stand Right Now

Get an idea of where you are now.
• How much you owe
• How much you own
• How much income do I bring in

#3) Buy Term Life Insurance

Everyone’s ideal term life insurance policy will differ depending on their income and obligations.
D.I.M.E.

• Death (to cover funeral and medical expenses);
• Income (to cover your income);
• Mortgage (how much to pay off);
• Education (for your children)

#4) ”What is it that you really want?”

You need to figure out what you really want. You need to have the desire to make it happen. When you’re trying to create a budget, this is the first thing that you should figure out. Ask yourself what you do on an average day. I suggest taking notes during a regular work day and try to make a note of all your expenses throughout the day:

• Lunch, snacks, coffee, dinner
• Gas, toll, or other transportation fees
• Daily shopping trips
• Work expenses (office supplies, etc.)

Tally up the expenses that you make on an average day and see how much you spend each day – not including your regular bills (utilities, rent/mortgage, etc.). Now see if you can cut back on the non-essentials.

#5) Look Into Your “Borrowing” Habits

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How often do you ask for loans? How often do you use your credit card without having the money to pay it off right away? As most of us learn in college, credit cards can be a dangerous lesson in financial responsibility. For a majority of the public, this will be their downfall. It is a simple concept to grasp –
“Don’t buy something unless you have the money for it.” – and yet, we borrow money all of the time.

For more information about this topic, check out this handy “how-to” video.

#6) Pay Off Your Debt

Credit card debt is something that will hold you back from personal and professional success – no matter what stage of life you are in. If you have a lot of debt piling up, it is time to take it by the reigns and gain control.

There are many ways to handle debt, and they all depend on how much money you are bringing home.

I personally found success in paying off my smaller credit cards first. Once I paid off a card, I took those payments and applied them to my bigger cards. While it still took me a few years, the end result was successful, and I can happily announce that I am now debt-free.

In order to become more financially responsible, we must analyze our spending habits and learn from our mistakes. Prioritize your spending and ask professionals for help when you are in trouble or have questions.

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