Monday Morning Quarter-Buck 06/18/2018: Controlling Your Finances by Kate Welker



I recently spoke with someone who told me “I have a good job, I have a budget, but I feel like I just can’t make it.” A report by CareerBuilder last summer stated that 78% of U.S workers live paycheck to paycheck and 10% of those struggling make over $100,000.  In our society of easy to obtain credit cards, outstanding student loan balances hitting $1.5 trillion, and often just a general lack of financial knowledge there are many people struggling to “make it.”

This makes me think of getting on a fast moving treadmill without the controls.  Once you are on the belt you have to keep moving and as long as you take steady steps, you will stay on upright.  If you stop paying attention and stumble, you are going to get hurt or fall behind.  If you try to slow it down you will fall off.  If you just jump off, that treadmill is going to keep going whether you are on it or not.  Do you feel like your finances are that treadmill just waiting to run away from you?

Making a solid plan to get back in control of your finances is going to eliminate the stress and anxiety you may be feeling every day.  Following are just few areas you can focus on to feel like you have that confidence and control:

  • Budgeting - Take a hard look at your monthly budget.  See if there lifestyle categories that may be creeping up. Ten-dollar monthly subscriptions add up, other subscription type services increase price over time. Evaluate the regular expenses to see if there are a few things that could be dropped or call to negotiate the price.  Maybe there is a luxury expense that you just have to have, maybe consider splurging every other month instead of every month.
  • Tax Returns and Pay Stubs - Take a hard look at your pay-stub.  Consider any tax-advantaged benefits you might not be taking advantage of such as a medical savings account or dependent care account that will lower your overall tax deductions. If you find yourself with a large tax refund at the end of the year consider updating your W-4 to have more funds available each month.  It might feel counter-intuitive to contribute more to retirement when you cannot balance a budget, but if you are a higher income earner the tax savings may be worth it.
  • Emergency Savings - This one can be huge when you feel like you are stretched too thin. Building it up will take discipline and time, but when an emergency happens instead of having to use credit, you have the savings available.
  • Debt - Monthly payments can quickly kill a budget and eat up the extra funds for fun money or savings goals. I generally see this area as the biggest contributor to cash flow struggles.  If there are student loans, research or meet with a financial planner about loan consolidation, payment plans, or forgiveness. If there are high interest credit cards or numerous cards look into opportunities to consolidate into one loan with a lower interest rate, or smaller monthly payments that allow you to pay extra towards the balance. 

Financial struggles can feel overwhelming and are the number one cause of stress in America.  Personal determination, planning, professional guidance, or financial counseling are all tools to help you slowdown that treadmill. Turning this situation around will take time and perseverance. Choose to take your controls and implement change.