Are you in debt? You are certainly not alone (which is a problem in itself). It’s a problem for the simple reason that if it is common for everyone; it is easy to get a little complacent about our own financial messes. We think we must not be that bad if so many other people are in the same boat.
This allows individuals to place the blame outside of themselves. But, the reality is, most of us just make really poor decisions when it comes to money. But, it doesn’t have to be this way. Here are a few helpful hints for getting in control of your debt.
Own the Problem
You won’t get out of debt until you take responsibility for it. It is important to recognize that it is your problem and yours alone. Sure, some of you may have been subject to emergency expenses, unexpected job losses, and the like. And, it can put us in a bit of a bind—understandable, but if we take a stance all this stuff is to blame, and we are just a hapless victim, we will never be able to solve this problem effectively.
I suffered from some pretty serious debt problems a few years back, and the reasons it accumulated were pretty compelling. It was easy for me to keep blaming everything outside me. But, once I changed my stance, I was able to develop a plan to fix the problem.
You have to do a serious inventory of your spending habits to see where you are being irresponsible; you have to see where you are spending money you should not be spending out of some false sense of ‘entitlement.’ Sure, everyone deserves a nice vacation, or a quality meal at a nice restaurant sometimes, but not when you can barely pay your bills. You need to uncover your bad money habits.
Stop Thinking of ‘Budget’ as a Dirty Word
When we hear the word ‘budget’ it does not exactly invoke enthusiasm. It makes us think of cutting back, and sacrificing all the fun in our life in the name of ‘fiscal responsibility.’ Making a budget requires us to really sit down ,and look at our finances, and spending habits; and this may present us with a cold, hard truth we have been trying to avoid. We don’t want to directly think about all that debt; we don’t want to see how we have been wasting our money.
It is easier to live in denial, and just hope the problem will somehow solve itself with minimal effort on our part. We want to keep doing things as we have been doing, even though we know it isn’t good. By avoiding making a budget, we can kid ourselves into thinking things aren’t so bad.
But, if you can change your outlook on what it means to ‘budget’ and see it for the powerful tool it is in solving financial problems, you can begin to take advantage of it. All you are doing when making a budget is creating a clearer picture of your finances so you can make more responsible choices that will help you get out of debt.
Get down all your expenses, and see where you can make some cuts. Do you really need the cable plan with 500 channels? The one with 250 will probably suit you fine. Maybe consolidating your debt with a balance transfer credit cards can cut down on your monthly credit card payments. Where you can trim your entertainment budget?
With a bit of maneuvering, you can surely come up with a plan that allows you to tackle your debt without giving up your whole life. Sure, some sacrifices can be made, but peace of mind about your financial situation is well worth it. I decided it was, and it made it much easier to stick to my guns. I saw my budget as my ally, not my enemy.
What is Your ‘Why’?
Sure, you want to get out of debt and improve your finances because money problems bite the big one. But, it goes deeper than that. You have to really clarify what is driving your desire to derail your debt. My two main reasons were getting rid of the horrible, overwhelming feelings of anxiety that consumed me because of my situation, and being able to travel long-term with minimal financial obligations.
Peace of mind and pursuing my passion were very strong motivators. You need to define your core motivators to make the choices necessary to really take control of your finances.
Readers, if you have ever been in debt and want to share your story, feel free to leave a comment.
Phroogal Jason says
“You have to really clarify what is driving your desire to derail your debt.” This is very true. A person must understand the why not just the what and the how. Knowing the why helps motivate and keep focused on the financial goals.