Signs that you are living beyond your means

Last Revised on July 25, 2009

Love Your Health Money Family & Relationship

There are some Red flags to imply that your finances are in trouble and you might be actually living and spending moneybeyond your means and you are capable of affording to.

These warning signs could mean that you’re living beyond your means and you need to change these things in your life to get back to healthy financial lifestyle. First and foremost thing is to be aware of how much money you have coming in – how much are you making. If you are making barely enough to buy three servings of fast food meals a day, then you should reconsider you job and look to start another career. But lets says you have a job that pays good and is higher than the sum total of all the monthly bills and expenses you carry with you and still have nothing in the bank, you might be in serious trouble. Your make more than enough to pay the bills, so you should have good balance in your bank account. You should be saving more than 5% of your income every month or from every pay check.

Check your credit score and see if it has been faltering below 600. If so, you could be in financial trouble that you need to get out now. You credit score is mostly based upon how often you pay your debts and bills on time. Higher the score, the better you were with paying off the debt on time to the lenders.

Got health insurance or not? Most of us believe that sick illness thing will never happen to us, unless we are already sick. That’s the reason why many people don’t like to pay for health insurance, others can afford to pay. In this kind of situation it is important that you have enough cash money at your disposal if you have to visit hospital for your health conditions. If not, you have to make plans because medical bills are considered among the top most expensive things people have to spend money out of their pocket.

We covered bills already, but couldn’t emphasize it enough. If your bill is getting out of control, try to tame it. Or maybe cut down the sources of bills. For example, you can cancel your cable or internet – one or the another. You can also stop your daily newspaper services. You can watch news on TV or read them free online.

Bad investment goals is something that you should definitely avoid. You shouldn’t invest money in risky stock market when you don’t have saved enough cash. Stock investment market is so volatile that it has a potential of taking away your lifetime savings in a matter of few minutes.

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2 Responses to “Signs that you are living beyond your means”

  1. Joseph Gasol Says:
    August 1st, 2009 at 12:14 am

    a good example would be a person who can’t afford to buy groceries from the store to make meals but can buy $10 mcdonald’s menu meal every day. why don’t he just save these money up and cook at home. it should make a big difference at the end of the month. trust me…been there, done that and learned my lesson.

  2. Timothy Volker Says:
    August 3rd, 2009 at 11:07 am

    Researchers have been conducting studies since early 1990s and they show that American people in general are saving less money than ever. It was proven that in year 2006of Economic Analysis that average personal savings have gone way down to -0.5% – that is negative 0.5. This really shows that we are living beyond what we can afford. Actually isn’t that the reason why we are in recession – that people borrowed tons of money from mortgage companies but when in real they can’t afford to make the hefty amount of payments they signed up for.

    But yeah back to your original question – How can you really tell if you are living beyond your means and waiting for a deep financial trouble? I think the best way to know you are living beyond your means is to calculate your income and compare it along with all the expenses. Usually, the highest spending expense is considered to be the house payments or rent for your apartment; and many experts recommend that this house payment or rent shouldn’t exceed more than 25% of your monthly income and you have to pay that off quickly for interest keeps on piling up.

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