When you are dealing with a lot of debt it is really difficult to think about monthly budget ideas for debt management. But this is really the best time to get your cash flow under control. If you are dealing with debt and trying to figure out how to manage the debt you have a monthly budget is a good place to start. How do you get control of your debt? How do you manage your budget? The best way is to begin by listing all of your income and then all of your regular expenses. Your expenses should include your monthly payments for rent, utilities and of course your monthly debt payments.

Monthly Budget Ideas for Debt Management

Once you have a handle on your cash flow and know what your budget is each month, it is time to make some decisions. What areas can you curtail to help deal with your debt? Can you refinance your debt with lower interest rates and lower monthly payments?

The important thing is to analyze every aspect of your cash flow to determine what sacrifices you can make to get your cash under control. If this does not work and you are still unable to meet your debt payments, drastic action needs to be taken.

Can you sell something? Can you refinance your debt? Or perhaps can you get another job to increase your cash flow on a temporary basis? Worst case is to apply for some level of bankruptcy? This will have a big impact on your credit rating.

You may also want to sit down with a financial advisor to help find ways to deal with your financial situation.

We all need ways to cut our monthly bills. The following are 7 ways to cut your monthly bills and have some money left over for some of the other priorities that you just have not been able to get too. While all of these ideas may not apply, hopefully one or two of them will and will save you money.  Consumers will also have ideas of their own which you can let us know by leaving comments on this post. We are happy to hear of ways to reduce costs and expenses and will pass them along. Finally, even the small stuff counts. Although you might not be worried about $5 a month, add several of these up and they together can make a difference. Obviously you should tackle the large savings opportunities first but do not forget the little stuff either.

7 Ways to cut your Monthly Bills

Reduce Mortgage payments – renegotiate your mortgage for a lower interest rate

Reduce loan payments – consolidate loans with one low interest loan, pay as much as you can as quickly as you can to repay the loan in full

Reduce utility costs – turn off lights, reduce water usage and adjust the thermostat to reduce your utility costs. Shift heating and cooling to low rate hours etc

Reduce car insurance payments – evaluate how much insurance you need for health, life, car and home. Negotiate a better deal for no claim situations.

Pay less for your smart phone – negotiate a better contract, shop around, get a smart phone free with a contract, use WiFi to reduce data portion of your bill, use text instead of calling.

Pare Down Food Bills – buy sales, buy in bulk, avoid specialty items and clip coupons.

Drive smarter – combine errands to reduce trips, avoid jack rabbit starts and stops,  drive at the speed limit and coast into stop signs and lights instead of breaking at the last minute.

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Many people complain that the 1 percent are too rich and should share their wealth more. The real issue is not the wealth of the 1 percent, but the difficulty the 99 percent is having in raising its own standard of living. Why are young people having so much trouble landing career-building jobs? Pensions disappearing? Why are more companies offering contract work instead of full-time jobs? Why is it so hard for laid-off middle-aged workers to find new employment?

These are the real issues that stop people from spending within their budget assuming they have one. As much as we want to blame it on the 1 percent of the population who control a large share of the wealth, we need to keep our own spending within our budget. We need to take responsibility for our own well being and work to achieve not only the things we need in life but also our wants.

Spending within our Budget – Avoid Interest Charges

Many people get in trouble when they overspend their budgets by charging whatever to their credit cards. When the bill comes due, they are unable to repay the balance and then are charged high-interest rates on the unpaid balance.

Buy what you need, not what you want, and only make purchases when you can afford to repay the balance and avoid paying interest. Needs are items that are basic to our well-being, food, clothing and shelter. Wants are things we can without including expensive food, clothing, and shelter. If the house you are living in is too expensive for your income, it is time to move to something less expensive. Buying the best steaks is nice and enjoyable, but sometimes you need to cut back and eat less expensive food. The same applies to expensive clothing. We all want to look great but sometimes you need to cut back and only purchase the clothing you really need. Can those shoes last a little longer etc?

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One of the best ways to reducing expenses is to tackle all areas of your cash flow for you and your family. The following areas are possibilities for reducing expenses for the family.

Reducing Expenses

Track Spending – The first step is to go over exactly where you were spending money. Set up a tracking mechanism that tracks all of your expenses so that you can review at the end of the week and also at the end of the month.

Trim Food Costs – by looking for sales, buying involved in larger quantities to get it cheaper per unit price. Evaluate whether you really need to purchase more expensive food items.

Pocket Savings From Sale Items – as you save money from buying things on sale, take that cash saved and place it in a savings account or some other area where it cannot be spent. It is amazing how quickly the savings add up.

Reduce Your Rent

Can you reduce your rent by negotiating with the landlord? Can you take on a roommate? Should you move to a lower-cost rental unit?

Shop for Best Price for Services – if you purchase services for everything from housecleaning, to Peyton to oil changes always look for the best price. You might be amazed at how much money you can save my shopping around. Even a 10% Percent savings can add up over time.

Hunt for Travel deals – last minute deals, re-positioning loses one block off the beach, can save a great deal of money. Always shop for the best deals.

Shave Savings from Spending – pick something that you can do without for reduce your expenditures and shave some of your expenses to increase your savings.

Ask For Discounts – always ask for a discount regardless of what you were purchasing. You will be amazed at how often a discount will be offered.

Pay With Cash – as part of asking for a discount, offer to pay with cash. This provides better cash flow management and many merchants are more willing to offer discounts when paying with cash.

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Many consumers wonder every year about how can I fix their spending and get control of their financial situation. They may feel that their spending is out of control. They may feel that they are spending too much money on interest and loan payments. Many may find it difficult to pay all of their bills every month. They wonder how they will ever pay for an emergency, major repairs, or even go on a vacation.

It takes hard work and some discipline. However, it can be done. But like trying to lose weight you have to really want to take control of your spending before anyone will really be successful. Consumers will find that they may have to give up many of their favorite things if they are in serious trouble. The sad part is they can either do it now under their own control. Or have someone make the decision for them and force them to do it. This usually occurs when they lose the house, the car is repossessed or they are turned down for a loan.

How Can I Fix My Spending

Here is our proposed set of steps to answer the question, how can I fix my spending:

Set up a budget

The first step is to set up a budget. Total up all of your income and then add up all of your expenses for everything that you must pay monthly. Next, add in a monthly amount for yearly expenses. This might include such items as property taxes, annual insurance charges, etc. If you find that your expenses are higher than your income, it is time to take stock and start reducing some of your expenses to get them in line with your income.

Track your spending

Knowing what you spend your money on is also important. For some, it may be a surprise when they find out all of the things that suck their cash away and help them end up with not enough at the end of the month. Know what you spend your money on and then control your cash expenses to help meet your budget.

Compare to your budget

Compare your actual cash expenses to your budget and make appropriate updates to how you are actually spending money. You may find that you need to reduce further to meet your income level. It is all about living within your income!

Make adjustments

Make adjustments as your income or your spending changes. Recheck your income levels and spending levels on a monthly basis and make adjustments to your budget and your spending to make sure that you are continuing to live within your income level.

Focus on quick wins

Begin by focusing on quick wins. In other words, there will be some items that are easy to cut from your spending and in fact may cause little pain or difficulty if you stop spending on these items. One friend of ours was paying a personal trainer to help them lose weight. Get serious, dump the trainer, save some money and exercise yourself! There may be lots of examples of this sort of thing in your life that you can quickly change that will deliver a quick win.

Focus on big items

As part of the quick win strategy, focus on the big spending items. Eliminate or reduce them first to get the biggest bang for your time. These can quickly get your budget in line and help you balance your budget.

Be disciplined

This is the hard part. Being disciplined about getting your spending under control is tough. Once you have a plan and you are seeing results, you will be encouraged and you may actually have more money available to spend.

Summary

So if you’re still wondering how can I fix my spending. Reread this post. Take a moment to consider all of the suggestions. Which ones can be applied to your situation? You may be surprised that with a little tweaking here and there, you can get your spending under control and actually save some money. Saving some money for emergencies can improve your life greatly and make your life much more secure.

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This post is another in the series about the biggest financial mistakes that people make in their lives. In this post, we will tackle two of the most common mistakes that people make. Leaving a job and not discussing money issues with your spouse or partner. Both can lead to problems from a financial perspective as well as on a personal level. However, that is the subject of another topic. We will stick to the financial impact of not discussing money issues.

Biggest financial Mistakes – Leaving a job

Lots of people leave their jobs every day for a variety of reasons. Some are fired and some are laid off. Some people just leave because they do not like the work or they do not like the boss or for a variety of other reasons that are important to them.

The mistake that this latter group of people makes is that they leave a paying job with no prospects of another job on the horizon. They are confident that they will find another job in the near future and so they leave voluntarily without any kind of severance or payout. They even lose the two weeks’ notice that many employers might pay them. In addition, there is a period of time that each must person must pass before they will qualify for unemployment benefits. It is longer for people who leave jobs for no reason and so they lose out there as well. By just leaving a job they have lost a considerable amount of money and will never be able to recover that money.

In addition, finding another job in today’s market can be difficult. There are lots of people looking for work and the competition is fierce. Employers for some reason will hire a person who is employed a lot more often than someone who is unemployed. We are not sure of the reasons, but we think that there is a stigma attached to someone who is not working and that employers also view someone who is working as someone more desirable. It is much easier to find a job when you are working than when you are not.

Don’t make the mistake of leaving a job before you have found another one. After all, you have bills to pay.

Not discussing Money Issues

Another big mistake that a lot of people make is not discussing money issues with their spouse or partner. If you are in debt and need to cut back a bit, it is important to have your spouse on board to help you. If he or she just goes right on spending, the problem just gets worse and you go further into debt.

When they finally do find out there is the possibility that they will feel betrayed and also angry that there are suddenly these debt problems that they knew nothing about. Most people want to help and work together as partners to solve financial issues and money problems. But if they do not know about the problem then they cannot help and can actually make the problem a lot worse.

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Leading up to Christmas 2012, there was a great deal of news about the fiscal cliff the United States was facing and how these two guys in the picture  let it go right up to the last minute until one of them blinked. Fortunately for the president, the other side blinked and they extended the debt ceiling until the end of March 2013. Now we get to go through this all over again while the politicians play politics with each other. But what about your own personal fiscal cliff?

Your Personal Fiscal Cliff

Unfortunately many people are facing their own personal fiscal cliff, but they do not have the solutions that the president has. They cannot print more money and they cannot always raise their debt ceiling. Bankers and lenders who decide if they are going to lend you money can decide not to or they can just increase the interest rate they are charging for the loans that you may need. A personal fiscal cliff can happen any time and all that is needed is some unexpected expense and suddenly you are facing a credit crunch. For many people,  unexpected expenses will be medical bills or major damage to their homes from storms.

The personal fiscal cliff is very real for many people. A combination of mortgage on the home, personal loans for the car or other items and their credit cards may be close to be max’d out generating high levels of interest payments. This is probably the worst situation to be in for many people who have not balanced their own budget and have not matched their income with the monthly payments they have. This is their personal fiscal cliff and it is quite scary if you cannot make your payments and facing foreclosure or are having debt collectors calling you all of the time.

Take control of Your Finances

Don’t be like the president and run it down to the wire or the last minute. You do not have the leverage he has and the results can be catastrophic on a very personal level. Talk to your banker or lender, consolidate your debt and put a plan in place to repay your debts as quickly as possible to avoid falling over your own personal fiscal cliff.

Consolidation of credit cards for example can reduce your monthly payments and significantly reduce the interest you are going to pay. This approach will free up cash flow you can use to reduce your remaining debt and make a huge difference to your debt situation as well as maintaining or improving  your credit rating. Talk with financial managers, talk with lenders and seek help to resolve your situation. Doing nothing about your looming fiscal cliff is really not an option for most consumers.

Take control of your situation and reduce the overall cost of the money that you owe. It is money in your pocket if you can reduce the total amount that you owe.