You have done your best to practice sound financial management. You have created the budget and stuck with it. You have managed to avoid using credit cards unnecessarily. Even after all that, you find that you are still struggling financially. You have reached the point of having to tighten an already tight belt. What do you do?
We all go through rough financial times at some point. It is a normal part of life. What separates the proverbial men from the boys is how we respond to tough financial circumstances. Giving in and falling apart is a sure way to allow your problems to win. Standing firm and fighting through is the path to victory.
So what do you do when it’s time to tighten an already tight belt? That depends on your circumstances. There are a few examples below that might help get you pointed in the right direction.
1. Evaluate Wants and Needs
There are certain things that human beings need to survive. These include things like food, water, and shelter. There are other things that are merely wants. These are things we can do without. Unfortunately, many modern consumers have trouble discerning between the two.
For example, having two cars in the driveway is nice if you can afford it. But a car is not a need. It is a want. It is possible to get along without one, and plenty of people do it. Maybe you could get by on one car for the time being. The money you save by not paying for two cars can go to supplying your legitimate needs.
2. Evaluate Your Childcare
If both parents are working, perhaps it’s time to step back and evaluate your childcare. Perhaps there are ways you can save on childcare expenses that you haven’t looked at. For example, do you know family members who might be willing to look after the children so that you do not have to spend so much on daycare?
In the absence of such money-saving strategies, consider whether both of you should be working. If one income is being totally consumed by daycare expenses, that spouse quitting and staying home with the kids would constitute a wash. Maybe that’s the way to go.
3. Evaluate Your Income
There are times when it is just not possible to tighten the belt anymore. You are already on the very last notch. If so, it might be time to evaluate your income. Having no more room to cut only leaves you one other solution: increase what you’re bringing in. That might mean a second job or a side hustle.
Perhaps you’ve avoided taking on extra work because a good work-life balance is important to you. Very few people would disagree with the work-life balance concept. However, that balance must be viewed as a luxury for the time being. It’s more important that you get financial troubles under control so that they don’t break up your family.
There is one last thing to consider: maybe solving your financial problems requires a combination of strategies. Perhaps you could combine all three strategies mentioned in this post. Over time, they would solve your financial problems and put your family back on solid footing.
We all have to tighten the belt at one time or another. If you haven’t yet, rest assured that your time will come. Belt tightening is a normal part of adult life. You might be introduced to it after losing a job, facing a health crisis, or losing your home. Just know that how you respond could determine your financial future.