If you have come across this website, it likely means that you are either struggling with your finances, or you are anticipating that you will be in the future. To avoid falling into debt, we highly recommend working out a budget to help you visualize your expenses more clearly.
A budget is simply a document that summarizes your monthly income and expenses. While some people choose to lay out their budget in a computer document, others feel more comfortable just using paper.
Outlining your monthly income and expenses will allow you to see precisely where your problem areas lie. You can then figure out whether you can afford to cut out any expenses. If possible, you may also want to consider finding another source of income.
Increasing your income may seem like a difficult task, but there are several ways to do it:
- Work more overtime.
- Get a second job.
- Start a home-based business.
- Take in a boarder or roommate.
- Try to find a higher paying job.
It is important to consider the advantages and disadvantages of the above options before jumping into one of them. For instance, finding another job may reduce family time, which could make things worse for you in the long run.
For most people, finding a second job is not feasible due to commitments beyond their control (single parents for instance). Many people find that reducing expenses is much quicker and easier.
To reduce your monthly income, start by examining each of your expenses, and try to determine if any of them can be reduced or eliminated. Below are some suggestions on how to reduce expenses:
- Consider ways to reduce your housing costs (move to a smaller home or apartment, or find a roommate).
- Try to rid yourself of non-essential expenses (cigarettes, alcohol).
- Look at how much you spend on credit cards, and pay off the high interest balances first.
- Consider buying a coffee maker and travel mug. Many people spend unnecessary funds at their local coffee shop. By making your own coffee each morning you’ll be surprised by how much you save in a month.
If you have already tried all of these suggestions, and need additional advice, please contact us today. Our licensed bankruptcy trustees in Richmond, British Columbia can provide you with a number of alternative options, and will give you an initial consultation free of charge.