Everybody has a financial nemesis. Whether it's small, regular gastronomic indulgences, or occasional impulsive splash-outs on travel or transport, there's at least one money temptation that everyone suffers from. What's yours and how can you beat it?
In tricky financial times, getting a firm hold on your finances is more important than ever before. Perhaps you've made use of a payday loan online from providers like wonga.ca to help you cover emergency expenses – or perhaps you're up to the neck in student debt and don't want to kick off professional life with a big red number hanging over your head?
Whatever your financial situation, saving and budgeting sensibly is more important than ever. That's why we've compiled this helpful guide to knowing you financial enemy and then vanquishing it! Ready to get serious about your spending? Let's go…
Step 1: Identify Your Nemesis
Somebody, somewhere once said “keep your friends close and your enemies closer." Knowledge is power, which means that the better you understand your financial nemesis, the more equipped you are to beat it. It's time to take a good hard look at your lifestyle and your finances.
Sit down with your budget from the last year and review all of your outgoings. Divide your outgoings into clear categories; clothing, utilities, accommodation, food, entertainment, travel, holidays, and so on. Then, get busy with the highlighters.
Work out what proportion of your expenditure has gone on what. You should find that you're spending more on utilities, food, and accommodation. If that isn't the case, or if one of the other areas takes up a significantly bigger piece of the pie, you may have found your nemesis.
At the same time, be honest with yourself. Deep down most of us know where our financial failings lie. Some of us indulge little and often, others impulsively opt for a big, extravagant purchase every once in a while. Some of us can't resist a clever little gadget, others have a problem with perfume. Nobody's perfect.
Step 2: Vanquish Your Foe
Now you know what the biggest issue is in your budget, it's time to cut back. This isn't going to be easy. We all feel like we deserve a treat (and often we probably do), but unmanageable debt is no treat, especially when it's compared to lovely, relaxing financial stability.
To vanquish your financial nemesis, build yourself a workable budget. Don't eliminate every naughty pleasure, but lay out strict guidelines about how much you can spend on what each month. For some people, taking out their budgeted cash at the beginning of each week and keeping their bank card at home can help. This eliminates the possibility of accidentally splurging on your financial nemesis...
Step 3: Celebrate Your Victory...
…but not too much. It's okay to treat yourself sometimes and a good reward system can be a great incentive for savers, but dwindling debts and a healthier bank balance should be the greatest reward. Making and displaying a chart or graph which shows your progress might sound a little simple and boring, but it can offer really strong encouragement and positivity. Once you reach a certain point, reward yourself with a (carefully budgeted) treat that tastes all the sweeter because you'll know you've really earned it!
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