Monday, September 18, 2017

Making The Best Of A Bad Lot: A Guide To Repairing Bad Financial Decisions

Sometimes in life, we make bad financial decisions. It may be because we don't have enough information at hand to make the right ones, or it could be because we are so preoccupied with the issue it clouds our judgment. However,  one thing is sure, bad financial decisions can have a grave effect on our lives and cause repercussions for years after. That is why if you find yourself in this type of situation it's best to do a little work to try and repair the problem as best you can. So read on for some advice on how you can make the best of a bad financial lot.

No medical insurance

Medical insurance is something that many people see as vital for both their health and wellbeing and their peace of mind. However, with premiums being so high, it can be something that some folks skip to make ends meet. Unfortunately, this a is a false economy because if anything does go wrong, the cost you incur from such bills is likely to far outweigh the little you manage to save by avoiding insurance in the first place.

Of course, you can't go back in time and change this, so what are the other options? Well, you can lower your medical bills by choosing free health care, or even traveling overseas to receive treatment that is cheaper than it is in this country.

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Another option to consider is to apply for social security disability benefits if you can no longer work. To do this, it's always best to get the professional is like LaPorte Law Firm involved. As this increases your chance of being accepted. Then when you are awarded disability, this amount can help pay for your basics as well as go some way towards any medical bills you have incurred. Meaning that you can avoid bankruptcy and further damaging your credit.

Bad investments

Many people see investing in stocks and shares and other financial products as a quick and easy way to make money. However, the reality of investing is often quite different. As you can lose as well as gain.

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So what can be done to make the best of their bad situation? Well, first of all, it's a good idea to stop putting good money after bad. So that means it's best to avoid the temptation to recoup a loss on the stock market by investing more money. This is because it's like being at a casino and continuing to play when you have wiped out, in the hope that you will make enough money back to cover your costs. Yes, it may happen, but if it doesn't you will be in even more debt, making the problem much worse, and with no guarantees, either way, it's just not worth the risk.

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The next thing to consider is whether your loss is permanent or temporary. You see the stock market can change in an instant, but those that are successful with these types of investments, are usually the ones that are in it for the long haul. As they can keep their investment in until the value of their stocks rises again. Making their loss only a temporary. Although, this does depend on them being able to do without the money in the short term, which is why most financial advisors suggest that you never invest money that you can't afford to lose.

No savings

Many people also make the poor financial decision to ignore saving for their future. Meaning they end up living paycheck to paycheck with nothing left over. OK, some folks will argue that they can't save because they just don't have enough, but is this always the case?

It is, of course, dependent on each individual's circumstances, but in many cases, it is possible to make reductions to everyday costs. Allowing there to be some money left at the end of the month that can be saved for an emergency fund. A fund that is there just in case the worst happens like the car breaking down, or someone getting sick.

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Common and relatively easy changes that can be made to fund this emerging savings budget include being stricter with the grocery budget, by planning meals and using coupons to cut the cost. Changing service providers for things like energy and utility can also assist in reducing month bills, allowing them to be more left over to be saved.

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It can also be helpful to divert funds to pay off bills that are on credit before saving anything. As this is a more efficient use of money in the long run.

Bad credit

Credit scores are important. So important that they can be the one thing that can stand in the way of your next major purchase, like a home or vehicle. That is why it's vital to look after them and keep them as high as possible.

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So how can this be done, especially if they are already damaged? Well, it's things like missing payments, being late, and not communicating with your credit provider when there is a problem that can cause your credit rating to fall. It can also be problematic if you apply for too many loans or new credit cards in one go. So one way to repair your credit rating is to stop doing any of these behaviors.

Another way is to consolidate your debts into a single loan, meaning the incidence of late or missed payments is reduced. While also making your monthly outgoings more manageable. Something that could improve your standard of living as well as your credit rating over time.

No 401K

Lastly, a terrible financial decision that many people make is to skip membership to a 401K program. As this leaves no provision for your finances in your old age.

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Of course, if you can change this by opening one, you should. Although if you are readily approaching, or have already arrived at retirement age without one, what can be done?

Well, if you don't wish to continue working it can be helpful to liquidate other assets that you have. Such as selling a property or business concern to allow you to live off of the profit you have made. Something you can find out more about here.

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