Begging for Money: Break the Cycle of Being Broke

Let’s be honest, shall we? Begging friends and family for money is getting old. You’re an adult now and it’s time to get serious about your finances. That’s why we’re here to help you break free from the cycle of being broke. In this blog post, we’ll outline 5 simple steps that you can take to start getting your finances in order. So let’s get started!

First, let’s talk about the debt cycle. You know the drill: you overspend one month, have to scrounge to make ends meet the next, and then before you know it, you’re broke again which leaves you asking others for money. Writing IOUs is getting repetitive.

Of course, if you’ve run into tough times it can be understandable that you might need some help. But we’re talking about when it becomes a habit!

And when it becomes a habit, we like to compare it to crying wolf. It’s like you’re always “in need” of money and after a while, nobody is going to take you seriously. Imagine if you ran into a dire situation where you REALLY needed help – you might hear crickets when you ask for help. That awkward silence is going to hurt.

So let’s break free from this vicious cycle. It is possible and you CAN DO IT! Here we’ll give you 4 steps to help get your finances in order so you can stop living hand-to-mouth.

The first step to breaking that cycle is getting on a budget. It might sound simple, but it can be hard to stick to. Put some effort into creating your budget and make sure it’s realistic for your lifestyle. You should also track your

Examine Your Income and Expenses

The first step is to take a close look at your income and expenses.

How much money are you bringing in each month? Think about all your income sources including your job, side hustles, rentals, investments, government support and more. Tally up an average month to see how much money you can realistically count on.

Do you make more or less money during certain months? Be sure to account for the seasonality of your income if that applies to you.

Make sure your income number is AFTER taxes. The income we want to account for is the money available for you to save, spend or invest.

Next, look at your expenses. Write down all the bills you have to pay each month. This includes housing, groceries, insurance, utilities, and all other costs you incur each month. Don’t forget small things like public transport, streaming services, subscriptions and more. Make sure nothing is slipping through the cracks as every little bit adds up!

Create a Realistic Budget

Now that you know how much money you have coming in and going out each month, it’s time to create a budget. A budget is simply a way to track your spending and ensure that your expenditures align with your financial goals. There are several ways to create a budget, so find one that works best for you and stick with it!

Start by adding your fixed expenses to your budget. These are expenses that are the same every month and can’t be reduced, such as rent or car payments (unless of course you move or get a different vehicle). Other fixed expenses include insurance, cell phone, internet, child care and more.

Then add in your variable expenses. These are expenses that fluctuate from one month to the next, such as groceries, gas and entertainment.

It’s important to be realistic when creating this budget. For example, if you’re used to buying a $6 Starbucks coffee every weekday morning then don’t try to cut it (just yet, that comes when we do cost cutting in step 4). Do you ask your friend to buy your daily coffee – this counts as begging for money!

You could also divide your fixed and variable expenses into sub-categories of essential and non-essential items. This helps when you get into cost-cutting in step 4 (often non-essential items are the first to get cut!).

Now compare your income to expenses. If you’re running out of money each month you’ll likely find that your expenses exceed your income. If it doesn’t, re-evaluate your expenses to see what is missing.

Once you have a clear understanding of your cash flow, you can start to set some financial goals and adjust your budget to meet those goals.

Set Financial Goals

Setting financial goals is an important step in breaking free from the paycheck-to-paycheck cycle that results in begging for money.

Your financial goals should be realistic and achievable, so don’t aim too high. Start small and work your way up as you get more comfortable with saving money each month.

Your first money-saving goal doesn’t have to be huge. In fact, starting small will help you build confidence and avoid frustration if you don’t reach your original target.

As a first goal, try to break even each month instead of setting a goal for how much money to save. That way, you won’t have to rely on others for financial support.

Once you’ve achieved that, you can start setting goals like:

• Saving a certain amount of money each month

• Building an emergency fund

• Preparing for large expenses such as replacing a car or starting a business

• Investing in stocks, mutual funds, and other investments

When you set goals, be sure to use the SMART (Specific, Measurable, Attainable, Relevant, and Time-bound) principles of goal setting:

• Specific: What exactly are you trying to achieve?
• Measurable: How will you know when you have achieved it?
• Attainable: Is it genuinely possible to achieve it?
• Relevant: Does it contribute to achieving financial goals?
• Time-Bound: When date do you want to achieve this?

By having clear financial goals you’ll be much more likely to act on them and stick to your budget.

Cut Costs

Now that you have a handle on your income and expenses, it’s time to start cutting costs where you can. Take a close look at your budget and see where you can trim the fat. Are there any unnecessary expenses that you can eliminate?

Start by looking at the non-essential items in your budget. These are the items and activities that either provide you with minimal value or can be completed for less money. Examples of non-essential expenses include eating out, magazine subscriptions, gym memberships, clothing purchases and more.

Even entertainment has taken a hit in 2022. This study found 39% of Americans were participating in fewer leisure activities such as concerts and cinemas.

Once you’ve trimmed some of the non-essential expenses, it’s time to look at your essential costs.

Are you able to switch to a less expensive cell phone plan?

What about groceries? Although groceries are essential, there may be non-essential items in your cart like indulgent desserts or snacks you can cut (and it benefits your health too!). A recent study found that 51% of Americans are purchasing fewer non-essential grocery items.

Cutting costs is an effective way to break free from begging for money and achieve financial goals. It requires taking a close look at your budget and cutting any non-essential expenses, such as eating out or entertainment. You should also review essential costs like cell phone plans and groceries to determine if you can make less expensive choices.

Find Ways to Earn Extra Income

In addition to cutting costs, another way to break the cycle of being broke is to find ways to earn extra income. Saving money will only get you so far, so it’s important to start supplementing your income with other sources.

There are numerous ways to make extra money including getting a promotion, changing careers, a part-time job, running a side hustle, or starting your own business.

Are you in an industry that has potential growth and you love what you do? Consider getting a promotion. Take initiative and learn any new skills, earn certifications or start working on projects that will help you stand out from the crowd.

What about changing careers? Consider looking for jobs in areas where there is potential growth. Also, research what kind of qualifications or skill sets are needed to get into those sectors.

The next easiest option is to get a part-time job. We say this one is easy because you show up, do the job, and get paid. Unlike side hustles or starting a business, getting a part-time job doesn’t require much upfront investment or long-term commitment.

The downside of a part-time job is finding one that fits your schedule and that it provides enough income to make it worthwhile.

Unlike a part-time job, working for yourself has no upper limit to what you can earn but there can be a lot of time invested before you see any gains. So if you’re after some quick cash, a side hustle or starting your own business may not be the best option.

If you’re not bringing in enough money each month to cover your expenses, then earning additional income is a necessity. Whatever route you decide to take, make sure that the extra income is going towards paying off debt or building up your savings account!

Review Your Progress

It’s important to review your progress after each month and adjust your budget accordingly. This will help you stay on track, identify any savings opportunities, and make sure that you’re meeting your financial goals.

Make sure to look at how much money you’ve spent, if all your bills were paid, and if you were able to save any money. If you find that you’re still in a financial bind, then it’s time to revisit your budget and look for additional places to cut costs or increase income.

Breaking free from the cycle of being broke takes dedication and hard work, but with determination and an organized budget plan, you’ll be able to achieve financial stability.

Final Thoughts on Begging for Money

If you’re sick and tired of begging for money, then it’s time to make a change and be financially independent! Follow these 5 simple steps—examine your income and expenses, create a budget, cut costs, and find ways to earn extra income—and you’ll be on your way to financial freedom in no time!