On Point Accounting & Tax

Don’t let financial fears paralyze you into a state of indecision; it’s time to take the reins and regain control of your financial future.

As the economy starts to recover and jobs may not be quite as hard to come by, it’s time to regain a sense of purpose and empowerment when it comes to your finances.  Here are some practical steps to help recover from and begin getting your fiscal future back on track:

• Evaluate your financial health: Prepare an updated list of your income, expenses, assets and liabilities. If your circumstances changed due to job loss or financial hardship, you may not have changed your spending habits until your savings have been depleted. If you’re looking to get your finances back on track begin saving for  the suggested six to eight months of emergency cash stashed away, now is good time to really pinch pennies to make sure that money is there when you need it

• Analyze your spending habits: many people don’t realize how much they spend on weekly trips to the market, afternoon lattes or dry cleaning. Aim to eliminate a portion of these expenses – start with maybe cutting back by 25% – more if you’re willing. And be honest about what you really can live without. Brewing your favorite cup o’ joe at home may not be as fun as a frothy latte from the corner café, but shaving four dollars a day from your food budget adds up to $120 a month in savings.

• Call your creditors before you fall behind. Many people avoid calling their lenders and credit card companies until the default notices start piling up. But these days many companies are willing to work with you, even deferring or temporarily lowering payments while you look for employment. Make those calls as soon as you suspect money will get tight and explore all of your options.

• Re-define your financial goals: Even if previous plans have taken a detour due to financial hardship or job losses, taking a moment to redefine where you see yourself in five, 10 or 15 years will help stave off discouragement and empower you to look forward. You may not be able to retire when you expected to, or pay outright for a four-year college, but instead of saying “I can’t afford it” begin looking for new goals and asking the question: “How can I afford it.”

• Meet with a financial professional. Even if you’ve done this in the past, getting professional advice about investment losses, financial products, insurance coverage and other important issues is essential.  You need to know how you can help meet your goals and objectives keeping in mind your present and future resources.

When you experience a financial loss, the emotional toll can be as high the monetary one. Making choices based on a new reality will go a long way towards rebuilding your self confidence and your bottom line.