Do it Now: Five Steps You can Take Now to Fix Your Broken Finances

When you find yourself in a financial hole, it can be overwhelming to dig your way out again. These five tips can get you past the initial sense of hopelessness and in motion toward erasing your debt and living within your means once again.

1. Create a Daily Spending Journal

Dieters who are serious about dieting write down everything they eat in a day. If you are serious about correcting your finances, you need to write down everything that you spend in a day. You may be surprised how much you are spending for small, incidental items. If you spend a couple of dollars every day on a snack from the vending machine, that adds up to ten dollars in a regular work week. Write down everything you buy for at least a week so that you will be able to see where your money is really going.

2. Write Down a Budget

It sounds simple, but writing down your budget is the best way to track your spending. Begin by listing all of your regular bills and the dates they are due. Then give yourself spending money for other thngs that you buy regularly, like groceries and gasoline. Make sure you give yourself some extra cash to spend on fun things as well as the necessities. Your budget should also include a certain amount toward savings every month, even if it is a small amount.

3. Check Your Credit Report

Everyone is allowed to check their credit reports once a year through three different services. Take advantage of the opportunity to see where your credit rating is and why. Look through the listings to make sure that all of the information is accurate. Understanding your current credit rating will help you make changes that will improve your numbers.

4. Stash Some Cash for Different Purposes

Keep some envelopes or jars in your house where you can keep cash that you might need during the week. One stash could cover unexpected expenses from your kids. Another stash could be kept for play money that you can use to eat out or go to a movie. Having these separate stashes ensures that you will have the money you need for certain purposes without needing to stray from your budget. Sometimes just knowing that you have a little money set aside for a fun activity will make you feel less urgent about going out, so you might actually save that money for another day.

5. Clear the Clutter From Your Home Office

Go through your home office or computer and clean it out. Keeping your files organized will help you keep your finances organized. If your paperwork is a huge stack on the edge of your desk, bills and other important documents can get buried or lost. Create a place where you can keep bills that need to be paid, and put your bills in that place as soon as you bring them in from the mailbox. If you make it a habit, it will be easy to stay organized.