Today’s article is from Suzanne. Suzanne is a certified credit counselor and a Social Media Specialist for CareOne Debt Relief Services. Follow Suzanne on Twitter @ADivorcedMom and @AskCareOne where she shares her insights on divorce and managing your finances.
As we make our way through January many of us are beginning to realize our holiday spending has caused a substantial increase in our credit card debt. The bills are starting to flood our mailboxes and we are hit with the harsh realization that we are in debt.
We begin to suffer not just financially but physically. Studies like this one show that the stress of dealing with debt can also have a significant negative impact on your physical and mental health. From ulcers, headaches, and an increased risk for heart attacks to depression and panic attacks, dealing with debt is literally making us sick.
The best way to reduce your chances of becoming physically or mentally ill is to get a better handle on your finances. As we struggle with debt we realize there is a problem but we have no clue how to get started making the necessary changes. The good news is that the actions are simple, easy to implement, and sure to make a difference in your bottom-line and your sanity.
Make a budget and stick to it
While we all know budgets are important many of us create them and never stick with them. To manage your finances effectively, you need to know how much comes into your household and how much goes out. The key here is to make a realistic budget and visit it as often as you can (at least once a week). Make sure you allow yourself some wiggle room so you don’t get discouraged; and don’t forget the emergency savings. Setting up an emergency fund can help keep your stress levels down if an unexpected expense pops up.
Cut your expenses
Once you have your budget up and running, it’s time to look for places where you can cut your expenses. You will probably be surprised at the savings you can rack up with a few painless spending cuts. Start with your non-essential expenses such as:
- Premium cable or cable period. You might consider cutting your cable and going with another less expensive options like Hulu or Netflix.
- Slash your cell services. I recently did this and decreased my bill by $76! It is amazing what you can cut just by calling and working out a better deal with your provider.
- Review insurance premiums. Insurance is always a tricky one, you know you need coverage, but how much and at what deductible? You can lower your overall premium by choosing a higher deductible (involves some risk, but can equal savings). And be sure to ask for all available discounts; safe driver, home security, multi-policy etc.
Don’t Miss a Beat
Missing or skipping payments is only going to lead to additional stressors such as debt collectors calling, hiked interest rates, and penalty fees. Get yourself organized by listing out all of your debt obligations and what you must pay each month; then determine if additional payments can be made on some of them in an effort to reduce your debt more quickly. Be sure to include:
- How much you owe
- Who you owe it to
- When payments are due
- The terms and interest rate of your debts
- Fees and penalties you pay for missing payments or paying late
You can use this information to prioritize your debts and make a plan to pay them off.
If you find you are in over your head there is help available just be sure to carefully research your options so you choose the right debt relief plan and provider.
Don’t Forget about You
Finances are stressful for most but when you are struggling with debt your health can really suffer from all the stress that goes along with being in debt.
Take time to remember the situation is only temporary as you are taking steps to fix the problem. While you are working on getting your finances in shape be sure to eat healthy, exercise, and get enough sleep. If you are feeling out of control or cant handle the stress talk to your doctor and find out how you can regain control.
Dealing with debt seems to affect many facets of your life, but don’t let debt take over! Remember, you are in control, you can kick it.
What has being in debt done to your health?