One of the things that you need to learn early on while on the journey to becoming debt free is how to take charge of your money.
I often talk about having a battle mentality when it comes to breaking the shackles.
- Your budget is your “battle plan”.
- Your defensive strategy is learning how to cut back on your spending for a period of time.
- Your offensive strategy is maximizing your income to add “attack power” to your budget and use it to knock out those debts more quickly.
- Your secret weapon is learning how to find bargains and refusing to pay full price for anything ever again.
When you combine all of these things together they create a serious force to be reckoned with. But they require one thing in order to execute. They require a commander…and great commander’s take charge! That commander is YOU.
7 TIPS TO HELP YOU TAKE CHARGE OF YOUR MONEY
Up to this point, your money has been doing its own thing. It’s been happening TO you. You’ve been compensating with credit to try to make your life continue to function. It hasn’t worked out very well. But now it’s time to turn things around, take charge of your money, and use it to break free!
1. STAY ON TOP OF YOUR BUDGET
Every single month make sure you sit down with your budget. Look at last month’s actual spending and see where you need to make adjustments for the month ahead. Always aim to improve on something from the month before. If you make even the slightest change each and every month you will be surprised on how much you can accomplish in a short period of time! Those little changes and tweaks add up fast.
2. KNOW YOUR PLAN OF ATTACK
Regardless of which payoff method you are using, you need to always keep at the forefront of your mind which debt you are working on and approximately how long it’s going to take to get it paid off.
If you choose to go with a debt settlement option they will let you know up front the approximate amount of time it will take to knock out all of your debt. So any extra money you get each month can be added to either additional debts not included in the settlement, or you can begin some savings and investing for the future. Don’t just sit back and let the settlement do everything for you. Be proactive and work towards the future so you don’t rack up more debt going forward.
Make sure everyone in your household knows what’s going on, especially your co-captain (significant other)! Have regular family meetings to keep everyone on the same page. You’ll be amazed at how excited everyone will get when they know that they are included in these discussions, and know what’s going on.
Don’t forget about the kids! This is a huge problem today. Nobody wants to talk to their kids about money. It’s one of the taboo subjects in most households. The problem with this is that NOBODY is teaching them about finances. The public schools aren’t doing it. Even if they touch on it, they are barely scratching the surface.
Tip: You don’t necessarily need to go into specific dollar amounts with your kids but make sure you include them so they will learn how to take charge of their own finances in the future and avoid a lot of your mistakes. It might be one of the most important things you ever teach them!
4. PUT IT INTO ACTION
Having a plan isn’t enough. YOU are in charge of putting it all into practice and making it happen. Without action, you will never get out of debt.
John Quincy Adams said, “If your actions inspire others to dream more, learn more, do more and become more, you are a leader.” Lead by example. Let others in on what you are doing and how you are breaking free. Not only will this inspire others around you to look at their own financial situations, but knowing that they will ask how your progress is going will add some accountability to keep you on track. You will always want to have a new success story to share with them!
6. ALWAYS BE WILLING TO TAKE ADVICE FROM OTHERS
A great leader isn’t just a person who takes charge and issues directives, but one who takes input from others as well. Whether it’s from your family, your friends, or even your co-workers, always keep an open mind and be willing to learn from other people. You never know where the greatest wisdom will come from and it could be something new that you’ve never even thought of.
7. READ REGULARLY FROM THE EXPERTS
There are many financial experts out there that have some fantastic books and resources on how to manage your finances. I have learned many things from all of these writers. I highly recommend you check out a few of these. Reading just 1 chapter a day will keep you motivated and give you a fresh perspective.
What about you? What ways have you found to take charge or your money and financial situation? Leave me a comment below.