Managing your family finances during hardship can help you and your family get through this rough patch. With 33% of American households having a tough time financially, many families could not sustain basic needs, according to Financial Crisis in American Households, a book written by Joseph Nathan Cohen. This is something that many moms can relate to because having a family usually entails always needing more money and having to live on a tight budget. Whether this is due to credit card debt, excessive overdrafts, or loans, nothing is unfixable and you can help your family by managing its finances and setting in better money habits. Doing this can give you an overview of what needs to be fixed to ensure a healthy credit score and more importantly, to make certain that you solve your family’s financial troubles for the long term.
Check your credit report regularly
Managing your finances can be difficult especially if you are stressed out about where you’re going to get the money for this month’s bills. Despite the anxiety that financial troubles bring, it is important to be right on top of your family’s finances because this helps you determine mistakes made by your bank. This kind of information will also help you dispute said mistakes. It can be as simple as an error in the interest rate of one of your loans or something as serious as identity theft. According to the Bureau of Justice Statistics, over 17 million Americans were victims of identity theft based on 2014 data and 67% of these cases resulted in a direct financial loss. While such a problem can be resolved, identity theft is difficult to spot especially if you are not on top of your finances. This is why it is advisable to check your credit report every four months, says Margaret Reiter, a debt settlement lawyer.
First things first
First things first
Financial woes are complicated. They can be a result of losing one’s source of income, paying for unexpected bills such as car repairs or home repairs, not sticking to the budget, not paying off loans until they balloon into a large sum or a combination of all of these. Financial problems in the US can be seen in a number of households regardless of income which means many are on the same boat too. The advantage of this is the amount and quality of help you can get. With more people having similar problems, a professional service is likely in place to help solve them. The first step is to look at the facts and make arrangements from there. Moms draw up a detailed budget too and should include spending priorities and savings. While it will be difficult to save a bit of money during such a time, it is still advisable to do so and you can make it work by setting a limit on your food budget and reducing transportation costs among other cutbacks.
Be objective
Knowing the exact amount of money you borrowed from your bank is needed so you can put a plan in place. If you have student loans and other types of debt, it is advisable to talk to a good finance counselor, according to Time because he or she will be able to set up a plan based on your situation. If in a severe financial crisis, your advisor will draw up a debt repayment plan and negotiate with the banks and your other creditors. Looking at your financial situation objectively can lead to a range of solutions that you and your family can choose from.
While debt and financial woes are worrisome, it is important to remember that no problem is permanent and that you can solve your family’s money troubles with steady budget habits over time.
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