I need to take a moment and be a little mean here. I’m not talking about “bully” mean, but the kind of mean where you just need to call stuff as it is. I’m talking about sitting you down as your old man would and having an honest discussion about the facts of life, it’s called tough love.
So here’s six reason’s why you may be broke.
1. You blame everyone else but yourself for being broke.
I know it sucks to be in debt, I know the cost of living isn’t cheap, utility bills, kids and all that stuff don’t come easy either. I know credit cards can be very cool shiny plastic devices that are easy to come by and with neat holographic images with brand titles like “gold” “platinum” or “elite” they can also be easy to use. Yeah, I get all that. Yes these can be reasons for being broke, but the first thing you need to do is recognize that the only part of the universe you have any control of is yourself. So, stop complaining about what life has thrown at you and take charge and do something about it. The blame game is for wimps, for most people, the real reason you’re broke is probably you.
2. You don’t follow a budget.
If you don’t have the first clue as to what your basic living costs are and don’t budget your spending, you need to do it now. Yes, learning the true cost of your finances might be a downer right now but you need to do the math. Get out of your imaginary world. It’s as simple as adding up your monthly after tax income and subtracting your monthly living expenses. All you need to do is make sure you spend less than you make, it isn’t rocket science. Do it now, create a budget and open up a gold ira today if you don’t have one.
3. You spend money on crap.
Marketers love people (they call them sheep) that are addicted to buying crap. You need to wake up and just say “no”! You know what kind of crap I’m banging on about, it’s the stuff you use once, it’s the “must haves” that are out of style every month. People “want” stuff because they think they are worth it or they deserve it. Learn to identify the difference between a “want” and a “need” and stop buying crap. The rich are rich, because they know it’s easier to save a dollar than earn it.
4. You don’t have a rainy day fund.
Experts encourage you to save at least 10% of your income monthly. Everyone should have savings set aside that total at least 6 months of living expenses. It’s called a rainy day fund. Sometimes when it rains, it pours and trust me, a rainy day fund can bail you out, big time. If you cut back on simple things like your internet, cable, telephone packages to a less expensive one, such as the ones mentioned on business broadband compare, it can easily add up to savings.
I suggest checking out ING Direct, they have a great product called an investment savings account. It’s not hard to save money. You just have to want to do it.
Most people think that just making the minimum monthly payments on a credit card will get them out of debt in a reasonable period of time. Wrong; carrying credit card debt is dumb. New disclosures forced onto the credit card companies on September 1st, 2010 are showing up on your statements now. Look for it; we’ve seen minimum payment disclosures showing upwards of 227 years to pay off debt by just making the minimums. If you are just making your minimum payments you need to wake up and put your credit cards on ice. I’m serious, stick them in the freezer, forget about buying more stuff and start paying the balance off in full.
6. You use payday loans to get by.
Short term loans, payday loans, or whatever fancy name they want to call them. They are for fools. Borrowing against your paycheque is a good sign you are drowning in debt. The calculated interest rate is often well over 200%. If you are in this cycle, STOP IT NOW. It’s a colossal waste of money. You might as well borrow from the mob. If you get your budget in line, you can easily break this cycle.
There, I did it. I know some of this may have hurt a little, but I also know, being in the business, that many of our clients have had to swallow this jagged little pill called “reality” too. The first thing you need to do is take a good hard look in the mirror. That’s the person who got you into the mess, and if you really believe it, and I mean REALLY believe it, they can get you out of it. If something is broken. Go fix it.
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