Budgeting to Avoid Bankruptcy

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If you are searching on this website, it probably means that you are either in financial danger, or are anticipating that you may be in the future. If this is the case, you should try putting together a budget to help you manage your finances.

What is a budget?
A budget is a document that outlines your monthly income and expenses. It can be done in a number or ways including on paper, or by computer.

Why should I use a budget?
Once you have outlined your monthly income and expenses, you will be able to see exactly where your problem areas are. This will help you determine whether you can afford to reduce any expenses. If you cannot, you could also try increasing your income.

How do I increase my income?
There are dozens of ways to increase your income, but here are some suggestions:

• Work more overtime.
• Get a second job.
• Start a home-based business.
• Take in a boarder or roommate.
• Try to find a higher paying job.

Be sure to weigh out the advantages and disadvantages before jumping into one of these options. For example, if you take on more over time, you may have less time with your family. This could actually make your situation worse in the long run.

How do I reduce my expenses?
For most people, reducing expenses is a much more immediate way to increase monthly funds, rather than increasing income. Begin by analyzing each item on your list of expenses, and try to figure out if any of them can be reduced. Here are some suggestions on how to reduce expenses.

• Consider ways to reduce your housing costs (move to a smaller house or apartment, or get a roommate).
• Try to eliminate non-essential expenses (cigarettes, alcohol).
• Look at how much you spend on credit cards, and pay off the high interest balances first.
• Consider buying a coffee maker and travel mug. By making your own coffee each morning you will cut back on unnecessary expenses.

If you have exhausted all of these suggestions, and are still in financial danger, please contact us immediately. Our licensed bankruptcy trustees in Prince George, British Columbia can help you identify the next best option, and will give you an initial consultation free of charge.

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