Address the MONEY mess! Carroll County, MD Series part 2
Blog Series: Discover how to get your financial house in order Carroll County, MD.
You have no money in your pocket. Your car payment is late. You have credit card bills, a cell phone bill, a car insurance bill, and you are living paycheck to paycheck. You worry about how you’ll pay the bills, get caught up and you pray you don’t have an emergency. Can you put your hands on $200.00? Most Americans can’t. This is no way to live! But where do you start?
Address the MONEY mess!
You need to:
know what you earn
know what you spend
know what you save
Plus one additional
know what you give
You need to know what are essential costs, lifestyle costs and priorities. If you can be clear about what your priorities are, you can create a spending plan that you can live and grow with.
According to Freddie Mac Credit Smart you should use this simple guide, The 50,30,20 Rule. Essential costs 50%, Lifestyle priorities 30%, Financial Priorities 20%. Needs and wants. Needs are basic survival items. Wants are things you'd like to have but could live without.
What are essential costs, lifestyle priorities and financial priorities?
Essential Costs (needs):
Shelter: Housing - rent or own
Utilities: Power, water.
Transportation: Car, metro
Nourishment: Food
Lifestyle Priorities (wants):
Gym membership
Hair stylist, manicures, spa treatments
Dining Out
Cell Phone
Cable tv
Gambling
Designer shoes, bags, etc.
Smoking
Drinking
Hobbies
Entertainment - going out, movies, etc.
Gifts
Vacation
Financial Priorities:
Savings
Retirement fund
Emergency fund
Erase Debt
By creating a strategic spending plan you can address the mess and grow toward your goals. It takes time and tenacity. If you really want financial clarity, you can get there.
You need to have a serious, honest conversation with yourself and your partner if you have one. What do you really want, not just today, but long term. Is stability and peace worth a bit of sacrifice? Would you like to stop living paycheck to paycheck? You can do it. You simply decide to make changes and stick to them for the long haul. I believe you can!
If buying a home is one of your long term goals, a lender can help you determine a direction. You can also contact an approved credit counselor. BEWARE of scam companies and those who call themselves credit repair companies, they are in business to make money and can more harmful than helpful. You can do it yourself. Check the Federal Trade Commission website for some valuable tips.
Blog Series: Discover how to get your financial house in order Carroll County, MD.
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