How to Budget When Your Bills are Higher Than Your Income

Natalia Jones By Natalia Jones, 28th Sep 2014 | Follow this author | RSS Feed
Posted in Wikinut>Money>Saving

Budgeting is actually meant to help bring your expenses in line with your income, so if your cash flow is consistently in the negative you need to take some serious steps to correct this situation.

Do You Find Yourself Constantly in the Red?

While being in the red is not an ideal situation, it is also not the end of the world. Luckily, there are ways to crawl out of the hole you seem to fallen into, but the way out is not easy and it will take time.

The following steps will get your budget to a place where you are not only back in the black, but you may even be able to save some money at the end of the month.

Be Brutal with your Expenses

If you are serious about balancing your budget you must find a way to cut your expenses. This may mean finding ingenious ways to save at the grocery store or simply learning how to live within your means

Find Ways of Increasing Income

You may have come to accept that your income is all the money you have to work with, but who says that this is all the money you are capable of making? You can use your spare time to make money by writing online or you can start a home business.

Start Paying Off Debt Sooner

If you have savings but you have been holding on to them as a type of security blanket while you struggle month to month to make ends meet because of high debt obligations, you may be sitting on the answer to your woes. It is probably safe to assume that your interest earnings on your savings are much lower than your debt interest, so it makes sense to dump all your savings if it would mean getting rid of a monthly payment sooner.

Even if you don't have savings, it is important to make debt reduction a priority. Any excess made from increases in income or reduces expenses should go towards paying towards outstanding balances. Miles

Make Saving a Priority

Once you have managed to increase the flow of cash into your account, reduced your expenses and cut down your debt payments, it is time to start channeling money into savings.

It is important not to let spending get out of control when money becomes available again or the process may begin again. Living on a budget requires discipline but the reward is the financial freedom to achieve goals and live the life you always dreamed of


Budgeting, Budgeting Money, Money Management, Personal Finance

Meet the author

author avatar Natalia Jones
Natalia Jones is a full time freelance writer and blogger. She holds a Post Graduate Diploma in Financial Management (ACCA). She writes on personal finance, business and much more.

Share this page

moderator Mark Gordon Brown moderated this page.
If you have any complaints about this content, please let us know


author avatar kant123
29th Sep 2014 (#)

Natalia Jones, very good tips on saving money. We should do expenses in accordance with our income. because I believe debt-free life is stress-free life.

Reply to this comment

author avatar Ptrikha
29th Sep 2014 (#)

Very good and vital tips. One has to make and implement tough decisions to keep things under check.

Reply to this comment

author avatar Natalia Jones
29th Sep 2014 (#)

You're right &kant123 debt-free is stress-free! Thanks :)

Reply to this comment

Add a comment
Can't login?