One of the most challenging things in most people’s lives is getting out of financial difficulty. Once you reach a point where you feel you are losing your grip on your finances, you need to make a plan to become financially stable again. You have to carefully analyze your situation because no one else knows where you are financially if you don’t tell them. The people around you can only help if they know about it. You will need to take action right away if there are any issues regarding something related to your financial situation because time does matter in this scenario.
You need to be careful with your finances. For most people, their biggest problem is debt, especially student loans and credit card balances. You may not want to hear this right now, but starting with loans can put you in a worse financial situation than if you had just saved the money up yourself. We all know student loan debt is becoming an epidemic nowadays, so there are probably some of you reading this and saying, “duh, I wish someone had told me about this before”. But don’t worry, everything will be okay once we get through it together because It’ll be like having your personal financial coach teaching you how to properly clear your bad debts quickly and efficiently without any unnecessary hardships or added stress.
The 10 Steps Of Properly Solving Financial Problems
There are ten different steps involved in solving just about any type of financial problem that might come up during your life. These steps typically involve a lot of research and patience, so it’s not something that can be easily completed in a day or two. That being said, it is possible to solve your money problems without any hassle at all as long as you follow the different steps outlined here. Some might sound fairly simple compared to others, but it’s important to always think about what’s best for you, especially when it comes to money.
Step 1: Where exactly do I stand?
This step is arguably the most important one out of all ten because there won’t be anything else accomplished if this isn’t followed correctly. You’ll want to take some time and make sure you know how much money you have, where your money goes every month, and what your financial goals are. It’s also a good idea to take a look at your past and see what kind of mistakes you’ve made in the past because everything from there can determine where you go from here.
Step 2: What am I going to do?
You might have been able to figure out what went wrong, but now it’s time to make things right again. That means finding new ways to earn money if possible, cutting down on spending, or even considering some more extreme solutions, like short term loans for bad credit, that could help you get back on track with your finances. Just remember that every person has their own set of problems, so don’t be afraid of trying something completely different just as long as it helps you achieve your financial goals.
Step 3: Where is my money going?
This step can be a little complicated if you’re not used to looking at the numbers just yet, but it’s important that you analyze where all your money is going every month. You might have finally managed to earn more income, but that doesn’t mean just spending willy-nilly because that’s how people end up in this situation in the first place. Make sure you’ve covered all of your expenses and set aside some extra cash for yourself, and at least some small investment.
The Golden Rule for Success is:
Out of 10 use 7
This is easy to understand. Use 70% of your net income to cover all of your expenses, in other words, try to fit your life into 70% of your income. The other 30% can be split into three equal parts, to use as follow:
- 10% deposited into a Savings account.
- 10% invested in a long term return vehicle like stocks.
- 10% spent on charity, a hobby, or a side job where profit will be great but is not necessary.
If you follow this method, there won’t be any room left for financial problems to take hold.
Step 4: What are my next steps?
It might seem like there’s nothing else to worry about once you’ve figured out where your money goes every month, but don’t get overconfident. There are plenty of other things to consider, just like what you’re going to do with the money you’ve saved over time if anything at all. There are also people who will need help during this process, so try not to forget about that either because there’s plenty more than just your issues at stake here.
Step 5: What other options are there?
As an independent person, there are only a few situations where it would be good for you to actually take someone else’s advice. In fact, it’d be best if you considered other ways in which you can solve your financial problems on your own before reaching out for help from someone else. That being said, it is better to ask questions and get a second opinion rather than make decisions without any help whatsoever.
Even Kings have advisors:
This is where financial advisors or brokers can enter the fray. They may be able to give you advice on how to invest in the stock market or how to trade cryptocurrencies. Ensure you get them to show you where they invest their personal funds, as this would indicate that you can follow their lead if they have been successful.
Step 6: How are you feeling?
It might not seem like it at times, but money is more than just a solution to all of life’s problems. Sometimes people are doing their best but are still struggling for whatever reason, so keep that in mind. If someone else needs some extra assistance, then try to offer whatever help they need because there’s always room for kindness, especially when it comes to financial issues.
The key here is to help others in such a way that you do not put yourself in a difficult situation. The easiest analogy here is: when you fly in an airplane, in case of an emergency, put the oxygen mask on your own face first before assisting other passengers.
Step 7: What have I learned?
At this point, you’re probably getting close to being out of the woods as far as your financial problems go; good job! Now you’ll want to take time and think about what kind of changes you can make moving forward so that nothing will come up again later on down the line. Don’t wait for your life to be relatively easy before you take a break and reward yourself; instead, try to improve your situation so that you can enjoy the rewards that much sooner without worrying about something else.
A great way to do this is to use 5% of every amount you earn and put it in your ‘Me Fund’, this is your own little kitty to spend on something you are passionate about. A reward for good behaviour if you will.
Step 8: How do I feel now?
It’s only been a few days since you got started, but it’ll already start to feel like an old hat. Before long, any financial issues should just become a small memory in the back of your mind rather than something you have to deal with every day. As soon as both the problem and stress are gone, you’ll start to realize how much easier things can be when everything is going right; good job!
Step 9: Did I make the right decision?
Now comes one of the final steps of financial problem-solving, reviewing your decision. If there are ways in which you think you could have improved the whole process, then try to apply what you’ve learned to solve it once and for all. If nothing else, just remember that every little bit of progress helps when it comes to this kind of thing, so don’t stop until you’re absolutely satisfied with what’s gone on before.
Step 10: What happens next?
Now that everything is over and done with, it might be hard to imagine what the future holds, but let’s face it – money will probably make an appearance in your life again at some point or another. You might be thinking about what kinds of things are going through other people’s heads right now because when things look bleak, the easiest thing to do is just give up. If you want to prevent that from happening, then you can take another look back at the first few steps in order to get a fresh perspective, so don’t be afraid to revisit them when necessary.
Just remember – when life gives you lemons, squash them, make lemonade, sell the lemonade and buy yourself something valuable!