It may come as a surprise, but roaring medical bills are the leading cause of bankruptcy in the United States. Consumer debts from credit card company come in a close second. While there’s little you can do about these costs, you can take proactive steps to improve your financial position and avoid falling victim.
A bankruptcy lawyer from Barski Law Firm PLC in Scottsdale shares the following tips:
Rethink Your Attitude Towards Money
It might seem like an abstract concept, but take a minute and think about what money means to you. Searching for these answers holds the key to achieving financial freedom. Your attitude towards money drives your spending habits. If you view money as the gateway to happiness, then you’ll probably spend your last cent in this pursuit.
Worse still, you’ll incur heavy debts as you chase after every shiny object on the market. The need to look cool and seek social validation often drives people to incur substantial debts. Having the proper attitude towards money lets you put it to good use and to spend it wisely.
Create an Emergency Fund
If you’re a two-income family, you need an emergency fund that covers your living costs for three months. If you’re a single income family, spread this to six months. Guaranteed, setting aside enough money to last you this long is a herculean task.
However, it comes with a silver lining. To achieve it, you need to polish and improve your money skills. It means that you’ll have to create and follow a budget. You’ll have to drop any bad money habits and watch every penny that you spend. If necessary, you’ll find creative ways to improve or increase your income.
Money management remains an elusive skill and when coupled with the rising cost of medical care, they set up many people for bankruptcy. With a little effort, you can improve your financial situation and avoid falling victim.