Getting back on your feet after a financial setback can be difficult, especially among the Americans who felt the effects of the pandemic on their finances. But there are tons of little things you can do to start building up your finances and get ahead. One great way is by keeping track of every penny you spend so that you can see where your money is going and make adjustments. It may seem overwhelming at first, but with a little discipline and motivation, all those pennies will add up into something big!
Review your budget and make adjustments.
When it comes to your finances, it’s important to be proactive and organized. This is particularly true if you filed for a chapter 7 bankruptcy to allow you to start on a clean slate after going through financial challenges.
And one way to organize and manage your finances is by regularly reviewing your budget. This means taking a close look at where you’re spending your money and seeing if any adjustments need to be made. Maybe you’re spending too much on dining out or entertainment, or maybe you could stand to save more on your groceries. The key is to be mindful of your spending and make changes where necessary.
It’s also important to remember that your budget isn’t set in stone. If something comes up and you need to adjust your budget temporarily, that’s okay! The important thing is that you stay mindful of your finances and make changes when needed. By keeping tabs on your spending, you’ll have a better idea of where your money is going and get a better sense of what adjustments need to be made.
Start saving early.
It’s never too early to start saving! Even if you feel like there’s no way you can ever get back on your feet financially, it’s still worth it to save as much of your income as possible. It’s easier to get ahead when you get started early, and the longer you let your money sit in savings, the more interest you’ll earn.
Do what it takes to start saving some money each month. Whether this means cutting back on spending or finding extra work, any amount that you manage to save is one step in the right direction. It can be hard to make ends meet when your finances are tanked, but if you start saving now, you’ll feel less pressure in the future.
For example, say you normally spend $200 on groceries each month. And let’s assume this money goes straight into savings after you buy your groceries. If you start this habit today, in 10 months, you’ll have saved $2,400. This may not seem like a lot, but imagine what you could do with that money in 10 years. The more time your money has to accumulate interest and grow, the better!
Start tracking your spending to see where your money is going.
Start making a list of everything you’re spending your money on and don’t forget the small stuff, like parking meters and gum! This can help you see where your money is going and start making adjustments. For example, if you find that most of your income goes into dining out or entertainment, you might choose to cut back on those expenses so you can use your money for savings or other things.
You can also choose to upgrade your lifestyle by choosing to cut back on specific items and indulging in the ones you enjoy more. For example, if you’re always buying coffee at work but rarely treat yourself at home, maybe start bringing a travel mug and making your coffee every day after work so you can cut back a little on your trip to Starbucks. The key is to identify where your money is going and make adjustments as needed!
Start going through the motions of being financially responsible
Even though you may have fallen on hard times, it’s important to start getting into good financial habits as early as possible, even if you think you’ll never be able to get ahead. If you feel like there’s no possible way for your finances to recover, still make a point of saving as much as you can and taking good care of the money that you do have.
By at least going through the motions now, you’ll set up the financial skills and habits that will help you in the future. And when life takes a turn for the better, you’ll be prepared and ready to take advantage of that opportunity!
It is possible to get back on your feet financially, but it will take some effort. You need to be mindful of where you are spending your money and start making small changes that will add up in the long run. It’s also important to start saving as early as possible so you have a cushion for when things get tough. And finally, don’t forget to keep track of your spending so you can see where adjustments need to be made!