With the disastrous sovereign debt crisis in Europe fuelling austerity measures in governments across the globe indebted for more money than they make in annually, two methods are generally setup at odds with one another: austerity & monetary stimulous. The choices government leaders have are to cut back on everything in the hope that the economy will right itself as their debt shrinks, or to go further into debt in an attempt to spur businesses into greater investments, greater production, and even greater growth. Neither approach is popular or appears to have a particularly strong effect when everyone is living in fear. The governments worry their investments will go sour, big business worries that governments will default on their loans and be unable to pay out their contracts, while consumers try to hold their money tightly for fear that they’ll lose their jobs. Disastrously, fear of the state of the world economy, has crippled the world economy.
As governments and big business worry about their pocketbooks and ignore the real effects they have on people, it’s important to re-examine how we, the people, are using the money that we’re trying to squirrel away. Most importantly, it’s time to re-examine how we live in contemporary society. There are a lot of pressures and expenses, and like most of the developed world, individual Canadians are currently straddling a large amount of debt. Some of the debt is reasonable, with the relatively low interest rates that come with the purchase of a car, the mortgage on a house, or a student loan. Others are not, like the gazillion charges on high-interest credit cards for everything from groceries through video games. This high interest debt can really add up, especially if you’re only making minimum payments:
Given that even fast food jobs are getting harder and harder to come by(1), getting a second job, to supplement your income and help combat ballooning debt is not an option for most people. Nor is asking for any sort of raise. The trick is to find ways to better use what you already receive, while building up a comfortable enough buffer that you no longer have to live one paycheque to the next. With that in mind, here are 5-ways to help you live within your means:
A few bonus tips: Lock up the credit cards someplace inconvenient at home, look into finding a less expensive place to live (perhaps within walking distance of work), and consider starting a small home garden, either in your yard or on the balcony to trim your grocery bill. There are a tonne of places on the internet with all sorts of advice and software for sale to help you trim your personal debt. Doing so may not spur the global economy back on track, but ensuring that you’re more comfortably balanced economically will inevitably lead to additional spending in the long-term as the money you’ve saved by killing your credit cards is reinvested in all the items you “wanted,” but didn’t really “need” when you were fighting your fiscal demon.
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