Wednesday, February 7, 2018

Do You Need a Financial Detox? 5 Steps to Better Money Management

Do you struggle with your finances? Are you able to pay your bills promptly? Can you set aside some cash for savings? Many people are not able to save money because of out-of-control spending. In fact, even before the next pay day, the money is already allocated for debt payment.

Can you relate to this situation? Perhaps a financial detox can help. Whether you have a serious money problem or you just think that you're not saving enough money, now might be the right time to have a financial detox.

We are aware of body detoxification. But detoxification doesn't just apply to the body. It can apply to finances as well. Detoxification is a good word for the process of withdrawing from spending, as the discomfort and challenges of doing so can feel quite real, just like what happens with a physical detoxification.

But in the end, you'll feel relieved that you're able to live within your means and you'll have the joy that comes with better money management.

Are you ready to give financial detox a try? There are five steps that you need to do:

Step 1. Know your financial challenges.  

How do you find out where you are spending your money that you really shouldn't? You could check your bills and bank statements. If you see an expense that you don't recognize, mark it and find out what it is.

You could also make a spending tracker. List all your expenses everyday for a month. Then at the end of the month, you can see a realistic picture of where your money went.

Step 2. Admit the truth.

From step one, you would know where your spending weaknesses lie. Examine your spending tracker, bills and bank statements to know which areas you've been wasteful. Are you spending P2,000 a month at Starbucks? Are you eating out five nights a week? Do you have too many subscriptions like cable TV, Netflix and mobile data? Too many beauty treatments each month? Too many drinks with the boys? Admit the truth.

Step 3. Find the 'Why.'

Go a step further. Don't just know how you spend your money. Find out why you've been spending money this way? Is it because you are bored? or sad? If so, one big challenge for you is dealing with your feelings. Some people overeat, overspend or find other outlets because of boredom, depression or sadness.

4. Start the detox. 

You can choose to detox financially in three ways:

* Go all out. Just decide to eliminate all the unnecessary expenses from your life. This is tough but doable. You'll have to be strong-willed to succeed.

* Decide to do away with a few expenses. Maybe you'll skip the weekly massages or one of your subscriptions. You'll keep some of your optional expenses but eliminate others.

* Cut back on everything, but don't eliminate it. Maybe you'll decide to cut all your discretionary spending in half. This way you still get to do everything, only not as much. Instead of having your weekly massages, you can have it every other week, for example.

5. Make it permanent. 

If you're going to take away one of your spending habits, replacing it with something you enjoy can increase the likelihood of success. Maybe instead of going to the mall where you're likely to spend, go to the park and have a walk for a healthier body.

It's normal to experience spending withdrawals. You could find a different substitute activity to manage the withdrawal symptoms. However, like being on a diet, it's never without its challenges.

A spending detox might be just what you need to get your spending under control and help to guarantee a positive financial future. I certainly need this. Let's try these tips today. Be strong. Change is challenging, but we can do it!

1 comment:

Kristine said...

Oh, what a helpful post! Really struggling here, especially that kids had been sick for several months already.