YTMP introduces a new guest contributor Catherine K Burke.
“Every time you borrow money, You’re robbing your future self.”
Hi there! Start reading this article by remembering these 2 double-digit figures. 72% and 60%.
72% and 60%; what are these digits?
Well, the American Psychological Association’s latest survey has found that 72% of Americans are feeling stressed about their money and debt now. More terribly, 60% of US consumers are living paycheck to paycheck life every month. It means they have simply no savings. In the time of the COVID-19 outbreak, they have turned into the most vulnerable community who have become the prey of financial stress.
Financial veteran says, in this financially horrifying time, you need both mental strength and financial guidance that can pull you out of the situation. In this article, some financial guidance is being presented before you that will take you out from the money and debt stress.
Take a look at the 5 concrete financial strategies.
- Create a budget that will keep your stress at bay
Many Americans have a misconception about the budget that it will increase their household-financial stress more. In reality, this is a baseless conception. A well-planned budget can help you to pay off your debt quickly. With the budget, you can create for yourself a long-term financial future by removing your money-stress.
Nowadays, creating a budget is so easy. You can take help from the personal budgeting apps like Mint, Goodbudget, PocketGuard. These personal budgeting apps have their customary features as per your requirement.
Otherwise, you can take professional help also. So, create your monthly budget (It is the ideal way) and remove the money and debt-stress burden from your head.
- Create a provision for Emergency Fund
Have you ever thought about how to manage your unexpected expenses and sudden emergencies when they appear before you? Well, your answer is hidden in the ‘Emergency Fund’.
The ‘Emergency Fund’ can act as your first line of defense and can cover all your sudden financial emergencies. First, try to save $500 to $1000 in your emergency fund. Later, try to save 3 months to 6 months’ salary in your emergency fund. With an emergency fund in hand, you don’t have to take too much stress about your money and debt repayment.
Statistics can make you relieved that now, 70% of Americans have understood the importance of an emergency fund. You can save the money in the Emergency Fund from the CARES Act stimulus check.
- Make a plan on how to repay your debt quickly
Debt is one of the prime reasons people suffer from financial stress. Be it secured debt or unsecured debt like credit card debt, student debt, or the payday loan; debt is never considered a good thing for your finance. While a credit card debt has an average of 18% interest rate, a payday loan has a more than 300% interest rate. You can improve the state of your financial stress by removing the debt burden from your shoulder.
You can take professional help to settle your debt or consolidate your unsecured debts. Using a balance transfer card is another good idea to pay off the outstanding balance with a zero-percent interest rate. If you have taken the payday loan, various ways are open before you to eliminate payday loan debt. It is much better to ask for expert help than suffering from a high-interest rate (300%) to repay the outstanding balance.
- Identify the spots where you are spending unnecessarily
Be honest with yourself. Don’t indulge yourself in unnecessary shopping sprees. Because this is one of the spots financial stress is grabbing you due to your weakness in spending money unnecessarily.
There are some common places where Americans have the habit of spending unnecessarily.
Shopping: BusinessInsider report says, Americans are used to spending more than $18,000 in a year on nonessential items.
Dining out: Usatoday report says, the US citizens spend more than $2000 per year for dining out.
Entertainment: Spendmenot survey says, the US citizens are spending more than $3500 per year on entertainment.
So, check yourself whenever you are thinking about spending your money unnecessarily. Because ultimately, you are going to lose your hard-earned money or have to pay a high-interest rate on your credit card outstanding balance.
- Concentrate on Side Hustles
While 2020 is going to be dominated by the corona pandemic; the positive angle of 2020 is the surge of Side Hustles in America. The sidehustlenation.com survey says, 45% or 70 million working Americans are currently doing a side hustle beside their regular profession.
Among the millennials, 50% of them are having a side hustle. Several side hustle ideas that can help you to earn at least $500 in your spare time.
Take a look at 3 popular side hustles.
- Virtual Assistant Service: You can provide all types of administrative services to your organization from your home. It is the job of an Online Personal Assistant.
- Virtual Teaching Service: Now amidst the corona, the demand for virtual teachers is sky-high. For example, you can earn $20 per hour for teaching English to students of non-English speaking countries.
- Web Designing Service: If you have a degree in web designing, you can utilize your skill for side hustles too. In this digital age, you will never find less work in the field of web designing.
There are a lot of side hustle opportunities in the market. Choose it as per your skill. It will help you to earn a supportive income besides your regular income. There will be less chance you are getting affected by any kind of financial stress.
Take the support of these 5 financial steps when you want to get out of your money and debt stress.
“Being in control of your finances is a great stress reliever.”
See, my friend. There are several effects of financial stress on your health. It can damage your self-esteem, it can make you feel flawed. On a more serious note, money and debt stress can bring several mental disorders like depression, anxiety, insomnia, weight gain/loss, etc. So, it will be better for you to apply these 5 financial steps beforehand and shrug off the money and debt stress from your life.
Author Bio: Catherine Burke is a financial writer for online payday loan consolidation. She provides information on successful cash loans and payday loan consolidation to help people get over a difficult patch. She lives in Kansas and has earned a frame in the matter of payday loans.
