There is no one fixed rule to measure financial success. For some, it can be getting out of debt, while for others, it can simply mean being able to get by. The journey of financial success, however, is not a cinch. It takes years to be financially independent.
You might find it hard to continue with it, and as a result, you can end up letting up your efforts. After all, it is not so easy to get rid of a debt spiral. You are financially successful as long as you are able to achieve your goals.
Tips to achieve financial success when you feel overwhelmed
It is not an overnight process to achieve financial success. You will have to be patient as well as strategic. Well, if you find it a bit harder, you should follow the tips given below:
- Be focussed
Focus is the key to making progress. Suppose you have decided to build up an emergency cushion worth £1,000. A consistent contribution of a fixed sum of money to your savings account every month is vital to make it happen. Make sure that you stay focused even if you come across some important expenses to meet. You should treat your goals as set in stone.
There are circumstances when you may fail to contribute to your savings account because you come across some unforeseen expenses. In this case, you should recover the loss in the next month. You should know how much you can stash away every month to know the length of time to achieve your savings goal. You should whittle down your expenses to achieve your goals faster.
- Choose your priorities
There can be several areas that you would want to work on, but you cannot deal with all of them together. It is possible that you want to increase your savings along with reducing your debt. Unfortunately, this is a catch-22 situation because goal cannot be achieved without compromising on the other goal. Experts, therefore, suggest setting priorities.
Ask yourself what is more important to you – growing savings or reducing debt.
Experts recommend getting rid of debt first because, otherwise, interest will keep accruing over time, adding up the cost of the debt. You should use a debt payment strategy – either debt snowball or debt avalanche – that suits your current financial condition.
Cleaning up your debt should be at the top of your priority list because it can help you avail yourself of mortgages or business loans for a start-up at lower interest rates.
- Break down your goals
It is natural to be overwhelmed while achieving your financial goals. You can feel frustrated at times, and then you may be tempted to give up on it. Instead of resigning yourself to frustration, you should break down your goals. Debt settlement is a big goal and you will not feel a sense of accomplishment unless you get rid of the whole of it.
You should start by dividing your goals into smaller chunks, such as paying off your credit card bills within a month. As you will achieve these smaller goals, you can celebrate your small successes. This will keep you motivated to stick to your plan.
- Make a robust plan
Many of you fail to achieve your financial goals because the plan you set to achieve them is not realistic. Deadlines should be set against which you can measure your progress, but they should be realistic. Your financial condition will determine how long you will take to achieve your savings goals, for example.
A plan without accountability is an absolute waste. Review your spending at the end of every month. Check if there are any areas that you need to work upon. Keep finding ways to achieve your goals faster and sooner.
- Increase your income
When you find that your income is not sufficient to achieve your goals, you should focus on boosting your income sources. Find a job with a higher pay. If you want to stick to your current job, ask your employer for a hike; however, you will have to prove your accomplishments. How the company has benefitted from your efforts is what your employer would want to know before offering you a pay hike.
You should also grab a side gig or a part-time job. There are various online platforms flooding with freelance projects. You can find work related to your field. Online platforms also give an opportunity to make money out of hobbies. For instance, you can earn money by taking up graphic projects or writing projects if you have some skills and interest in those fields.
Side gigs such as walking a dog and babysitting are also some of the ways to make money. The money you earn from your additional job should not be utilised for your monthly expenses. Make sure that you use this money only for your financial goals.
Apart from this, cutting back on your expenses is also a way to release cash that you can use up for your goals. Create a budget and track your expenses. You can even think of downsizing your lifestyle unless you are back in the driving seat.
The final word
It can be quite challenging to achieve your financial goals. Amid the rising cost of living, you can find it all the harder to make your wages work for you, but you can achieve your financial goals by being a bit strategic.
Set goals and prioritise them. Make sure you break down them so you feel motivated as you achieve smaller successes. This will keep you going. Set realistic deadlines. Many people get financially overwhelmed because they want to achieve too much in less time. This strategy will work against you.
Increase your income sources to be able to achieve your financial faster. You can switch to a new job with higher pay or grab a side gig. Utilise money you earn from your additional job to achieve your financial goals.