Budgeting money is rarely easy, but it’s especially difficult when you don’t have enough of it to even pay all of your bills. Given the current situation with COVID-19, you might be between jobs or simply have a job that doesn’t pay well enough to address all of your expenses. Either way, it’s important to change how you spend your money when you’re so short on funds.
Follow these steps for effective money management when you’re seriously broke:
1. Prioritize. Life is all about priorities. Look at how much money you have available and then prioritize your bills accordingly. Typically, your rent/mortgage, basic utilities, insurance, and food will come first. Credit cards are usually last on the list.
2. Avoid relying on credit. When cash is short, it’s a common practice to start using credit cards to replace a paycheck. The cost of this money can be incredibly high, and this debt is difficult to eliminate later on. Don’t fall into the trap of viewing credit as a viable solution.
3. Make a new budget. This might be the last thing you’re in the mood to do, but either your financial circumstances have changed or your current budget isn’t working. Both reasons suggest that a new budget is required. Take a look at your income and bills and make some smart choices. Remember that it’s all about prioritizing intelligently.
In stressful times like these, it’s easy to succumb to your anxiety and become stuck, but understand that this course of action will only make your challenges greater in the future.
Take a deep breath and do everything you can to get yourself back on track financially. You’ll be surprised how much you can accomplish when you really focus your intention and energy on solutions.
Prioritize your bills, increase your income, and make a new budget, and things will be better before you know it.
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