Do You Recognize The Warning Signs Of Financial Problems
Financial hardship is a situation when you are running short of money due to certain unfortunate event or unforeseen expenses that may come from nowhere. Having no money in hands could be giving you sleepless nights and causing stress in your life. Hard financial times must be also putting a bad impact on your mental health. Financial problem seems impossible to overcome, but there are warning signs of financial problems that you should always recognize to avoid falling into the trap of financial dearth.
No budget plan: When you do not have any clear picture of what comes in and what goes out, then it can automatically put yourself into financial trouble. It is likely possible to overspend and get into financial difficulty when you are not following a proper and planned monthly budget plan. This could be the first warning sign of financial problem.
No Savings: With no savings in your account, you might be personally inviting to financial disaster. Your income is not just meant to pay for your day to day expenses and wants. It is important to save some amount of funds every month for unplanned expenses and also for investment purposes for a better future.
Using credit cards more than required: When you start using credit cards to pay for lines of credit like for paying everyday’s bills, dining out bills and more, you may not realize that this is just a short-term fix. When your credit card bills generate, you simply want to run away from a situation by seeing such lined up bills and expenses. Stop depending on your credit card for each and every expense and avoid getting into serious financial debt.
Fighting over money more often: Every couple and family fight but fighting for money is not a good sign. For meeting short term and long term financial goals you need money and when you have lack of it, then the problem occurs. You indulge into more fights with your loved ones and this makes it a clear sign of financial trouble in your life.
Making minimum payment is not a solution: It’s tempting to pay minimum due amount on credit card every month and you may think you are doing right, but I is not the case. Making minimum payments at regular interval is a sure way to end up paying more interest over way. It will also harm your credit worthiness and creditors will soon distance themselves from you.
No payments: A string of missed payments on your report will put your credit score in danger. If minimum payment is a bad idea, then missed payment is surely the worse.
Using payday loans for unplanned expenses: Payday loans are secured against your upcoming paycheck. They are short-term based loans and are charged with higher rate of interest. With no savings for emergency needs, you tend to apply for such loans and thus inviting a financial trouble in your life.
Borrow money from loves ones: Borrowing money from family and friends is a good idea to take care of your expenses that are unavoidable, but relying on them to pay your bills every month indicates that you are some in serious trouble. Some day or other it may create damage in your relationship and when they ask for that money back, your credit may end up taking a hard hit.
Spending more than you earn: Sometimes you find yourself that you have over exceed your income than you actually earn. This will lead to sending disaster a personal invitation.
Too much debt: Debts problems are limit to what you can do with your money. It is possible that you fail to meet end even if you are earning good salary. Therefore, it is a time to keep an eye on your expenses and have to make out where you need to cut down on expenses. Too much debt can be crippling. You must address your debt issues as early as possible as it may not be able to get a good financial condition until you carry a baggage of debts with you.
Withdrawing from savings and investment accounts: If you find yourself making a habit of withdrawing money from your savings and investment accounts, then it’s time to realize you are into financial trouble. Investments and savings should only be used as last resort. They should never be used to pay for credit card bills or for regular monthly expenses. By doing so you not just losing on your savings but also losing the interest the investment money would be giving.
If you fail to get a grip of your spending and expenses yourself, then you should seek a financial adviser help. There are free credit counseling available online and can help you design a budget. It is important to realize the financial problem first and then look out for ways to fix it.