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Money Management: Handy Tips on How to Avoid Being Broke

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Posted 25th October 2009 at 12:53 AM by Anthony J Namata

What I saw on Facebook this morning under the keyword "broke" is overwhelming, to say the least. All these people whining about how broke they are would appear to them, to be a pretty daunting predicament to overcome, and reflects the true state of the economy. The recession is really biting in, that's for sure. So what can you do about it? In this short article, I want to go over the reasons why people go broke in the first place (recession or not), and how to seriously curb the spending. I will also share tips on how quick, simple, and easy it is to sell the stuff you no longer need for cash (or great products)!

Call me a miser if you like, but I have watched people spend money they didn't have and seen, firsthand, the trouble that that landed them in. I for one, would rather be a miser with money in the bank than flat out broke and destitute. Not that I haven't been broke, I sure have, but I learned from it. It wasn't a place I want to be, not now, not ever. So how then does one break the shackles that tie you down to a never-ending spiral of debt and frustration? It really is quite simple when you put your mind to it. I will show you how to quickly re-invent yourself financially. You will be pleased to have stumbled upon this article.

So let's begin. The very first thing you MUST know is that you can always live on less. You don't need that extra pair of shoes, that new dress, that new pair of jeans, that new mobile phone you'd promised yourself you were going to have no-matter what, just put a firm lid on all of that and ONLY buy what you REALLY need. And I mean that literally. If you develop this into a habit (stopping to THINK before you buy) you will gradually begin to realize that you have more money in your pocket (and in the bank). The trouble with most people is they buy on impulse... they'd step into a store, see something they had absolutely no intention of buying, and buy it! Just like that, without even giving it a second thought. I know it feels great and that it is therapy in itself--especially when you're feeling down for whatever reason--but the error of your ways begins to set-in once you get home and take a closer look at what you've just spent a substantial amount of money on when, as it happens, there's still that grocery list that needs sorting out, or your child's school fees that needs to be settled and so forth. Now where are you going to find the extra cash to pay your bills or shop for groceries when you've already
spent it? The trick is to prioritize EVERYTHING.

I usually have a list of items I want to buy, but what I do is I prioritize the list. Absolute essentials always go first, and then there are the little things I might want to acquire... like a couple of new CDs, or maybe a new home theater or a new mobile phone. What I do is I take a good hard look at what these items cost, and whether or not I must have them now! For example, it took me ages to get a new mobile phone, not because I didn't have the money, but because I had other items on my priority list that were more important. And here's something else, NEVER spend every last dime you have on you (priority list or no priority list), money has a nasty habit of dragging you down deeper and deeper into debt when you don't have a penny to your name. Don't ask me why. Just look around you. Isn't it true that when you're broke you tend to get even more broke? Well, there's your answer right there. So to avoid this, make sure that you have some money saved after all your purchases for that month have been made. Leave the pending items on your priority list for another time. You won't die, trust me.

So what can you do to recover at least some the money you've spent on items you hardly use? This is getting interesting isn't it? You've spent a fortune buying stuff on impulse, you haven't got a penny to your name, and now you want your money back? Sounds far-fetched? Trust me, it isn't. The solution is to auction, or to simply sell the stuff you don't want in your closet, or around the house anymore. There's money lying dormant in those items right there, you just don't know it yet. Make a list of all the items you posses that are cluttering your living space, and get rid of them! It's that simple. With auction sites all over the Internet, if you spent a bit of time itemizing, photographing and listing your items online, your efforts will pay off in the end. But please, don't go SPENDING more money to do this. Only list your items on sites where it is free to list, or costs very little. Remember, the purpose of this article is to show you HOW to avoid being broke.

In summary: The reason why many people go broke is because they lack the discipline to curb the spending. The trick is to get in the drivers' seat and to take charge of your finances. The first thing you'll want to adapt into your lifestyle is to train yourself to THINK before you buy. Whether you'll agree with this or not, we all tend to buy items that we DON'T really need. We buy on impulse and then regret our actions later. Exercising control by prioritizing your shopping list at all times will not only save you a fortune, it'll help you avoid being broke. But don't go spending the money you've saved, save it! And better yet, get rid of some of your unwanted items. You will be amazed how much money is lying around the house in those items we call clutter. Itemize them, photograph them, and list them online for sale! This is perhaps the quickest way to resurrect your finances that I can think of, off the top of my head.

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