Take Charge of Your Debt
Habit #2– Debt
For many Americans, financial concerns are a regular source of anxiety, which is understandable given the uncertainties of today’s economy. The monetary benefits of dealing with financial problems —saving more, paying down expensive debt — will improve not just your bottom line but your overall mood as well. The less you worry about dealing with finances and money issues, the more you can enjoy life.
Following is how to help reduce your money stress and get motivated to take control of your finances.
Write it down
Whether it’s the realization that you need to get more serious about saving for retirement or you are dealing with a troublesome credit card balance, it’s important to recognize what’s causing your anxiety. Write down your three biggest financial sources of stress so you know what you’re up against. Keeping the list short can help you feel less overwhelmed.
“Although it might seem as if staring at your debt is scary, it’s actually the best way to wrap your arms around how much you owe, what needs to be paid first and also if there are some habits that you need to break,” said Tiffany Douglas, senior vice president, Market Manager with Bank of America (BOA). “At BOA, our credit counselors really help customers uncover their debt and really put their arms around it and prepare to fix it. Some debt is good and is actually inevitable, but too much is troublesome and should be handled sooner than later.”
Give it a positive spin
Your mindset can help keep you motivated to fix your financial problems. Rather than get bogged down by thoughts of never getting out of debt, imagine the amount of stress you feel decreasing as your debt load gets smaller. It’s important to believe you can do it.
Be realistic
Determine what you can reasonably achieve and then dedicate yourself to following through every month. Make a measurable promise to yourself: “Each month I will spend less and put the difference toward my debt so my balance declines by at least $100.” Just like a crash diet or intense new workout routine can lead to burnout, you don’t want to set overly ambitious financial goals that you may abandon in a few weeks or months.
Make the most of your income
The belief that you simply don’t have enough money to put toward your goals can keep you from dealing with your financial problems. Try to focus on making the most of the income you do have by spending wisely. You also might consider using a calculator to see how long it may take you to hit a savings goal. Bank of America offers a savings calculator on its website that could help.
Small steps are key
You may not be able to cut any one expense by $500, but you may be able to identify five monthly expenditures you could reduce by $100. Sticking to a budget is not always easy, and there may be days when your resolve falters. You may need to modify your budget or your behavior. If you can’t go into sporting supply stores without buying something, stop visiting them.
Keep yourself honest
Leaning on your relationships can help keep you on track. Every hard task becomes easier with the support of friends and family, so share your goals. There’s no one better to hold you accountable and remind you what you’re sacrificing for than those you love, trust and respect.
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