4 reasons you’re broke, and how to fix it

1.            You don’t actively save

2.            You don’t have a budget for your expenses

3.            You are in debt and its not going down fast enough

4.            You are trying to live a lifestyle beyond your income.

Most people (and it’s January so Christmas will have made this work) are living barely within their means, are trying to keep up with what they think everyone has, and are not saving, and don’t have an active plan. If this keeps going, eventually you are going to be in financial stress and will have to drastically reduce your lifestyle to have a hope of getting out of it.

How to fix this is simple, but not easy.

First you need to do your budget – see our many articles on this. If we don’t know what you spend or need to spend, we cannot plan for the future.

Then you need to live within this budget, otherwise it was just a fun exercise. You need to actually follow the budget. Then stick to it, this is the hardest part.

If you have items you want to pay for, you need to save for them and pay in cash. This is a big change for most people who use debt to cover things.

Don’t add more debt and focus to getting rid of what you have, build this into the budget, and use the debt snowball method to pay this down.

If you have clear financial goals, all of this becomes much easier.

This is just a taste test for the year, keep coming back as we provide tools for you to make this more achievable.