6 Ways to Escape From Your Short-Term Financial Crisis
There are plenty of events that happen in life that lead to money issues – from medical emergencies, job loss, or unplanned purchases or trips that only come once in your lifetime. Once you realize that you’re getting into a financial rut, your first instinct might be to get a loan out of desperation. However, this will only worsen your financial crisis. Here are six ways to help you escape from your short-term financial crisis:
1. Accept that you have a problem
You must first accept that you have a money problem and that you need to stop spending before it’s too late. Look into your expenses and where most of your money is going. Once you’ve pinpointed the main cause of your money challenge, make an assessment of your financial priorities. This will guide you into where you should be spending your money and where you should restrict yourself.
2. Create a financial game plan
Although each case differs from one another, having a game plan to go about tackling the situation is a lot better than having none at all. Now that you know your financial priorities, create a financial game plan that includes how you will pay off your debts and how much money should be allotted for your bills, daily expenses, and miscellaneous expenses. Create a financial tracker as well so you know where your money is going.
3. Find cheaper alternatives
It doesn’t matter how absurd your ideas may be, even if it means coming off as an extreme cheapskate. Find cheaper alternatives for your usual expenses. Instead of eating out in restaurants every lunch, find cheaper yet filling meals or better yet, cook your own food. Create a meal plan ahead of every week so you can already sort out what you need to buy in the market and find more affordable choices. Another idea is to assess your bills and identify if you can avail of cheaper subscriptions, for your mobile for example.
4. Control your expenses even during a sale
Sales and promotional offers that go for as low as 70% slashed from the regular price are great opportunities to save, but most people tend to get carried away. While buying during a sale is cost-efficient, most of the time they’re unplanned purchases that ruin your financial game plan. Set a limit for your purchases and categorize this under your miscellaneous expenses so you’ll know how much you can spend on sales or unplanned shopping sprees.
5. Cash in on your education
Aside from your regular job, find other sources of income based on your skills. Find freelance jobs that you can do on the side. There are plenty of online jobs that will need an hour or two of your time everyday that can help you earn extra like freelance writing, graphic design, web design, and teaching English. If you have free time, you can try tutoring for some child that needs help with their simple quadratic equations or English.
6. Sell or pawn items that you don’t necessarily need
Create an inventory of the things in your house that you don’t need anymore. There will most likely be an item or two that have high monetary value. Don’t be afraid to make the decision of letting them go. You can sell them online or you can try online pawning for a less hassle transaction.
Above all else, stay positive. The only way to feel good about any financial crisis is to have a positive outlook that you will get through it. The smart efforts in overcoming short-term financial crisis will lead to the best results when you let go of things, positively.
Author’s bio: “Carol Soriano is a consultant for PawnHero.ph, the very first online pawnshop in the Philippines. A writer at heart and a social media enthusiast, she finds personal finance, investment and money matters interesting topics to write about.”