The current recession has definitely squeezed everyone across the board into financial dire straits. Thanks to excessive spending, consuming, over-extending credit, gambling, and bad risk investing, the economy spun into a downturn that caused most people to live on their savings, deplete their emergency funds, and merely survive from paycheck to paycheck, repositioning many to have to rebuild their financial stability from scratch.
That means a money makeover is required to bounce back from this rob–peter-to-pay-paul recession. Frugality in focus is the anecdote to a climate where jobs are no longer a permanent source of security and layoffs are the order of the day prompting the highest unemployment rates to date. And most people don’t have a laid-off contingency plan.
Foreclosed homes, defaulted loans, and bad credit doesn’t lend its wisdom to financial survival but implementing a short-term savings and allocation plan with smart investment moves can restart financial stability for the long haul. So here are nine key steps to revamping your finances.
Set Financial Goals
It is important to establish goals for one year, five years, and ten years expressing exactly where one wants to be financially. Whether it’s to accumulate $100,000 in savings, get out of debt, or own a home, starting with a small realistic plan that can be executed within a person’s current salary or financial assets, reevaluated spending and saving habits, and earning potential can progress towards meeting that financial goal.
Visit the Bank or See an Accountant
Go see a Banking officer or financial professional to get advice, direction, and information on how best to use and manage the money.
Do a Budget
Devised a percentage pie to figure out how much money will be allocated to living expenses, savings, investments, and personal leisure expenditures. Then comprise a spreadsheet budget of all item costs with the intention to balance that worksheet just like a checkbook
Get your credit report
A person must know where they stand by knowing how much they actually owe. Check credit reports thoroughly and regularly for accuracy. This will minimize anything unnecessary debts and empower preparation against any liens or further judgments.
Open a Savings
Use that tax refund check to jumpstart an emergency fund or start gradually but consistently to replenish that nest egg with $50 – $100 a month. Look at employing IRA’s, CD or interest-bearing money markets and savings accounts to get the most out of your money.
Balance Checkbooks and Analyze the Finances Once a Week
Confront the money every week to stay on top of it and continue to take control of all financial decisions. Work with the current cash flow to start a self-empowering habit to keep up with the money. Don’t let the mountain of debt or the big picture become so overwhelming that deciphering a starting point becomes stressful that nothing gets done. Start small and manage one bill or one account.
Enlist a Timeline for Financial Goals
Set deadlines and make a schedule for each aspect of the finances to ensure reaching the goal in a reasonable amount of time. Employ a financial team for accountability to measure progress and all decisions to keep on track towards the goal. Dreams without deadlines are just unfulfilled intentions reverting back to old destructive habits.
Plan on Making Investments
Bonds, mutual funds, and established brands are steady mainstays of reliable financial investments. Investments are risks. But the best way to make a consistent educated decision is to do research and consult a financial professional. When investing in a particular company stock, it is important to assess:
- Company investments
- Overall market climate: whether it’s booming or in decline
Tap into Sound Trusted Financial Resources
Keeping abreast of the market climate is essential for making financial decisions about one’s future. Denney D. Caberto, Banking Supervisor for TD Bank in New York advises the best way to anticipate the economy in order to make savvy investment moves now.
“I’ve learned in college that websites or books published in the 1980’s, 1990’s, even the 2000’s are not the best sources concerning how to get out of the present day credit crunch, failing market, and real estate meltdown. Time and Technology makes our market evolve. Articles and formulas that were forged years, months, even days ago are considered obsolete. The best source of information is you.”
Denney suggests these sources for getting a leg up in the financial game:
- Wall Street Journal
- Investor’s Business Daily
- The financial show Mad Money with Jim Cramer
It’s time to take charge and fiscally rebuild into a money-wise existence.