Can anything be done to turn upside down the economic situation? It is near impossible to find a real answer to this question, and if you read the newspaper or surf the web without any awareness, you will be reading facts and wrong conclusions like. People with money are making more and more buys using their credit cards, so the economy is failing. Things are getting worse!
The facts that help you to decide
I would like to present some facts that might change the way you look at these things because money is a choice, and it is your choice to use it or not. When money is involved, choices have to be made and hopefully, positive ones. Here are a few facts that may help you to see peoples’ point of view.
For example, if you win a lottery, you have a clean slate and are free to buy anything you want. If someone you know lost all their money, they probably used a credit card to pay for it all because it was easy to buy now and pay later. The fact is they still have some of the same choices they made when they won the money, but are faced with a choice of paying for it or not paying for it.
People who always have money, especially those who win the lottery, but have chosen not to spend it, have a choice. Pay for the things they need or do without. Others will have choices between paying down their debt, saving or investing the money. If you have no debt and are still money in the bank (not spent) you have choices. Invest the money or spend it.
Another option is to use what money you do have. If you have a little leftover, you can continue to get the things you already have and have each successive purchase reflect and increase your wealth, or reduce it. If you have gone overboard and have too much already, you can either increase your incoming money (income) or cut back on your spending (expenses).
How to cut your budget in a correct way
We have all heard that “cut your Budgets” or “stretch your guts” and these are options if used responsibly, that do not cost you money. They increase the amount of money you have to somewhere. You can make more money if you can just take your money somewhere else instead of spending it, but if you are already too far in debt you may have to make more money and spend less or get some help.
After about five years, if your income has increased, then you can start looking into buying a home or investing your money. If it has not, then you have no choice but to continue to use what you have, or hopefully, spend less and get out of debt. In the meantime, if you want to continue to live a healthy or intermediate lifestyle, it is vital that you fund your retirement or emergencies fund and you may want to buy a used vehicle rather than a new one if they are financed at the same rate as a brand new one.
The key to this is to take your 30-40% of your paycheck and then look at the 30-40% of someone else. If you cannot spend any more, you do not have the money for paying extra. You want to make sure that you can meet your financial obligations so that those options become available to you if you lose your income, and you do not want people turning up at your door asking for their money. If your money is limited, it can be difficult to make a change that will help your financial situation even up. Many foods lose 50% of their value, and Food Stamps are rarely able to stretch that much. Try buying store brand, or finding a cheaper price on items like arise, chicken and canned vegetables. Of course, if these are not an option, look for cut-rate priced meats and lean meats when purchasing these items. Likewise, the same principles apply to your pocketbook. If you think you cannot save any more, you need to make a move. It will pay off in the long run.
It is always good to have the bottom line in mind; you do have to spend more than what you can afford, however. If you are thousands of dollars in debt and cannot pay for something that requires more than your available funds, then you may want to look into debt consolidation, bankruptcy, or an IVA. Since so many of us are so overwhelmed with daily happenings and the various bills we have, it is common to not realize that the limited money that we have each day is minuscule in the grand scheme of things. With the large economic change today, we have become a nation of spenders and not savers. Think for a moment about what you have in your bank account right now and then, consider the possibility that you could be using a large percentage of it in just a few days and not noticing it.
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