money

Are you going through a rough time financially? We all know it happens to everyone, although the degree and period vary. At the end of the day, however, those financially rough times will happen, and when they do, what do you do? How do you handle things when your debt piles up?

You have two options.

Panic.

I suppose it’s quite understandable that this is the first thing that many people do. When you see a credit card bill that unexpectedly beyond what you can afford to pay off in months, even years. Not to mention all the other bills you have to pay every month – perhaps tuition fees, utilities, mortgage, and so on.

Aside from panic, there may be a slew of other negative, unhelpful reactions. These are just a couple of them.

Anger – at yourself or whom “caused” the financial problem.

Denial – You may say, “It’s okay. Something will come up. I’ll just ignore this,” hiding your head under the sand like an ostrich.

Calm down, and find solutions.

In most cases, however, these things don’t work. Financial issues don’t resolve by themselves. So here’s your second option.

Allow yourself to feel that moment (or moments) of panic, but don’t dwell on it. Acknowledge there is a problem, then bring yourself to a state of mind wherein you can think calmly and rationally. Meditation can help greatly in this case.

Once you’re in that zen state of mind, you can sit down and find solutions. If you have a partner, talk to him or her about it. If you are single, you can either find support in friends or family members, or you can sort things out alone.

What are some solutions to financially rough times? Having been through a lot – and I mean a lot – of these times, here are some suggestions based on my experiences.

Assess

Go back to the basics of budgeting.

1. Calculate how much money comes in every month.
2. Calculate all the monthly expenses that are absolute necessities – for example, food.
3. Calculate all the monthly expenses you can do without. Take note of the tiniest detail – a coffee from Starbucks now and then, dinner out with friends on Tuesdays, drinks with another set of friends on Thursdays, and whatever else that falls in this category.
4. Calculate all your debts – from loans to credit cards. Prioritize them in terms of the amount you owe and the interest/penalties they accrue.

Now, add up all expenses from #2 and #4, all broken down into monthly amounts. Next, deduct the total from your total income, and you’ll have what you have to pay every month.

You might have that panicky feeling again once you see that it might not be possible to live off of what remains, or that your expenses exceed your income.

What to do?

Act

You have to create a plan.

Tighten your belt.

Remove all those unnecessary expenses from #3 above. Go through your other necessary expenses, and determine the areas where you can make some savings.

Save Money by Being a Mindful Shopper

Get another job or side gig.

You will have to work longer hours, you might even have to work a graveyard shift, or at least part of it, but it’s a necessary sacrifice if you want to get rid of your debt.

There are many options for side gigs these days, especially thanks to the Internet. There are services which hire people who can work from home. For example, http://essaykitchen.com/ provides essay writing services. If you like writing and can do a decent job, then you might want to apply. You can also look at sites like Craigslist. Another option is a virtual assistant job. A quick search for ‘online jobs’ on Google will give you ideas where to start.

Find ways to eliminate your debt.

If you’re dealing with huge credit card debts from various companies, you can look for a debt settlement company to help you. Be careful when choosing a company, though, as some may be scams. The FTC has an in-depth guide on the topic.

Other options include dealing with your creditors directly to find a solution that satisifies both sides, a balance transfer, and a debt consolidation loan.

While things may seem hopeless when you’re going through this financially rough period, remember that as long as you take steps in solving the issue, you will get through it. Make the necessary sacrifices. Make plans. Stick with it. Before you know it, things will be looking up.