Sometimes Life Happens...

I started this blog what seems like a lifetime ago. I wanted to share financial tips that I was learning myself and help people reach Financial Independence...but...sometimes life happens and what you have planned for doesn't happen. You get side tracked by a death or an illness or losing your job.

Things happen. Your life might be falling apart, but something you don't realize at the time is that you are most likely neglecting your finances along with what your dealing with. When you make it through your storm and try to return to normal you realize that pile of bills you have been ignoring are bills.

Now you are starting all over financially. You know all the right things to do. You remember the lessons you learned. You know what you need to do.

First thing you do...is open those bills. 

You can't fix the problem if you don't just jump in and see how bad it is. It might not be as bad as you think. Put the bills in piles according to what they are. Get a notebook and write everything down. Putting it on paper helps me to get organized. I'm a list maker. If lists don't work for you...find something that does. Piles. Baskets. Envelopes. Whatever works for you. 

Then put everything in order from the lowest to the highest. Plan to pay the little bills first.

Next, start planning. Look at your bank statements. Look at your current spending. Start a budget. Make a list of your expenses. The plan is forming now. You have a list of what you owe due to, life. You have a list of your expenses. 

I know it looks overwhelming, but you got this!

Now, go through your bank statement and put all your spending into categories to find out where you can cut back to pay off some debts. Make the categories: Essentials, like rent, car note, electric, etc.; Extras; like eating out and entertainment; Savings; you may not have a savings yet but you will.

Take your list of what you spend and breakdown things like eating out and shopping. You can cut these back or even out. You will be surprised to see how much you spending eating out. This category is usually much higher than people anticipate. 

Finally, you can make a budget. 

Budget for the Essentials first. Then, based on what you spend on food and your situation, add Extras to your budget. Your budget will change, so don't be discouraged when if you have trouble meeting every item on your budget. Overtime, your budget will change and eventually become something that you can, realistically, stick too. Make sure that you budget something to go to savings every month or pay day. I use an online savings account and have automatic deposits set each month. This way it is not something I have to consciously do.  

Don't let your current situation stop you from achieving a better life. One step at a time and before you know it your situation will have changed, if you develop a plan and stick to it. 

Until next time...