You can feel quite overwhelmed if you are under financial pressure and this is not good for you and those around you like family and friends. It’s very easy to allow the emotions to kick in, the stomach to churn, to loose sleep, and to feel as though you have an insurmountable mountain to climb.

Dwelling on the situation will not fix anything. It’s important at this point to take action and continue moving forward. Once you start to put some steps in place your energy levels will increase and you will start to see a way to improve the situation. Here’s a step by step process to turning your financial affairs around in the next month:

Get Help – trying to do it alone will only add to your pressure. Simply discussing your situation with a qualified professional will not only help you see new solutions but make you feel you have an ally who can work with you and share the responsibility – and that in itself is priceless.

List a summary of current debts and assets/investments – a quick stock-take of where you are at will help you clarify your thinking. This is your personal “balance sheet”. Often a situation is not as desperate as it first appears once you get it down on paper. You won’t know where you need to go until you know where you are now.

Make a list of all your income and expenses – summarise your income and outgoings for the last 30 to 90 days. This is your personal “profit and loss” during this period and will highlight those expenses that are needs versus wants.

Decide the expenses you will reduce – now you have your expenses listed, you can determine which costs you can cut to help bring your spending into line. Still paying that gym membership you never use? Could you reduce eating out from several times per week to just one or two? These are the tough decisions but ultimately those that will make a difference.

Look at other sources of income – could you consider that second job? Put in for overtime? Ask for a pay rise?

Set a budget for the next month – now that you’ve made those choices, decide what your income and expenses should look like for the next month if you follow through on your planned income and expenses.

Set up a system to keep tabs on what you are spending – this is crucial. If you don’t put a system in place to monitor your spending then all your hard work will be undone. A simple spreadsheet or an online app will help you with this process.

Set targets – aside from your budget how do you want your balance sheet to look at the end of the month? Is there an amount you’d like to have saved in your bank account? What will your debt be reduced to once your new budget is in place?

Allocate the important payments first – it’s very easy to wait and see what money is left to put into savings or pay off debt. Instead set up a regular payment to go to the account you want first. Make a conscious decision you will live off what is left.

Review your investments – if you do have investments when did you last review them? Are they offering you the best return at the moment or are there better options?

Determine what you can sell – if you badly need quick cash then consider what you own that you can sell. The drum kit you never use, or even the car that can be replaced with public transport.

Review your loans and credit cards – now could be an ideal time to refinance or seek credit card providers that will offer you a more competitive interest rate

Talk to your creditors – if your financial pressure comes from having overdue debt then pick up the phone. Creditors will almost always extend more time to a creditor who talks to them rather than one who seeks to avoid. They will appreciate your honesty and will help work with you to sort the situation out.

Review your bank – are their fees and rates the most favourable in the market at the moment?

Review your insurances – not having adequate cover will only add to your stress. Make sure your insurances are reviewed and up to date

It will take more than a month to see the positive results from every step you put in place but, by the end of the month, you should start to see some positives leading you in the right direction and a feeling that the situation has turned.

Make sure you get professional advice. This will help you understand your options. Fear often comes from not understanding and simply having a good Advisor explain your situation will go a long way towards improving how you feel and what you can do.

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The information provided is intended as a guide only and does not take into consideration your personal situation, needs and objectives and should not be considered as advice of any nature.

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