10 Steps On The Road To Financial Stability

I was in an emergency room recently, and saw a list from the American Pain Foundation in the waiting room. It outlines what you need to do in order to seek out and acquire pain relief. I saw a lot of similarities between “the road to pain relief”, and “the road to financial stability”.

Speak Up

“You are your number one pain advocate and have right to timely and effective care.”

The idea of having to speak up for ourselves definitely lines up with practical personal finance advice. You may not realize it, but there are various times when you are called upon to be your own advocate. If you currently have high-interest credit card debt, you need to “speak up” and negotiate a lower rate with your creditor. This one move could save you thousands of dollars in interest!

If you notice that a recurring charge (such as a utility or insurance) has suddenly gone up recently, then examine your bill and give the vendor a call. By speaking up for yourself early, you can save money and a potential battle!

Speaking up is also important when it comes to negotiations. One of the best ways to increase your income is to demonstrate your worth to your employer and ask for a raise. You have to be willing to state your case – make sure you can back up your claims of being worth more than you are being paid!

Know Your Pain And Your Options

“Educate yourself about the available treatments.”

In order to fix your finances, you must know what your problem areas truly are. For instance, if you have a ton of debt because you have a problem with spending your money in a disciplined manner, then a debt consolidation isn’t the answer!

There aren’t too many “one size fits all” answers when it comes to personal finance, so you must examine your own situation and determine which options fit best.

Simplify

“Work with one provider to manage your pain care as much as possible.”

Many times when we have a lofty financial goal in front of us, it can become easy to try everything that’s out there! However, the best plan is usually to keep it simple. I’m sure that you know people who have several pieces of financial/budgeting software on their computer, a few personal finance apps on their phone, and reading a new financial book every week! This can make it difficult to focus on your goals, and also hurt your efforts to accurately evaluate your financial situation.

Take it slow at first and set priorities. While it is possible to attack more than one goal at a time, it is often best to have a singular focus when it comes to your personal finances.

Document

“Record your pain levels and questions for your pain care team.”

This is the point of tracking your expenses! You need to be able to look back at your records and see how you’ve handled your money. If there is a problem with your finances that needs correcting, this is something that you must do!

It can be very easy to blame your financial difficulty on a particular situation (such as healthcare costs, unemployment, or the terrible housing market), but if you do not document how you distribute every penny that comes into your hands, you’ll never know the true cause of the problem.

Reach Out

“Bring a relative or friend to your appointments and accept their assistance.”

Very few people (read: no one) can be an expert at everything. If you have someone that you trust, who is also knowledgeable when it comes to finance, try to involve them in some of your financial decisions. See if they are willing to review your budget, or evaluate your spending pattern.

Before I decided that I wanted to be a financial consultant, many of my friends and family members would ask me to review potential financial agreements, budgets, and big purchases in order to get an outside opinion from someone who loves finance.

Seek Out Information and Support

“Investigate resources in your community or online.”

There are a number of great resources for you to consider while seeking financial assistance. Some community colleges even offer basic courses that will help you create a budget, balance your checkbook, and even understand the basics of savings and debt accounts.

You can even take a look at the myriad of personal finance blogs out there – some  of which are written by experts in various fields. There is no excuse for failing to educate yourself when it comes to money matters!

Find someone who can help to keep you accountable in your spending (maybe one of the people that you “reached out” to above). Look for people who were in your situation and were able to fight through it and meet their goals – this is one of the great things about reading blogs! You may need that type of support and motivation in order to make the hard choices.

Take a Moment

“Listen to your body’s response to stress and anxiety. Make a habit of setting aside some time each day for deep breathing exercises to help ease your pain.”

Stress and anxiety are most definitely the byproducts of financial difficulty. In fact, studies claim that stress over finances is the number one reason for divorce in the United States. Before you let the situation overtake you, take time to reflect on your motivation (being a good steward over what God has given to you, your desire to be free from debt, wanting to be your own boss, etc).

Your initial stress and anxiety over the situation should move you to action, but after you have a plan in place, you have to be able to rid yourself of the anxiety that your past decisions have caused (as long as you are being faithful to your current plan)!

Know Your Limits

“By taking on less, you will ultimately be able to accomplish more.”

Most of our financial problems – especially debt – are the result of years of bad choices, and circumstances. Therefore, it is unrealistic to think that we are going to get rid of them overnight! You must be realistic when setting goals. If you have a family, you may not be able to work 20 hours a day trying to earn extra money! You may have to stretch out your debt repayment plan, in order to accommodate other things.

Another area in which you can go to far, is when it comes to deciding how much money to set aside for each purpose. It can be easy to throw every available dollar at debt repayment, however, you must remember to establish an emergency fund. Having $0 in savings is a recipe for financial ruin!

Take Stock

“Know there will be good days and bad days. Take a moment to focus on the good things in your life, no matter how small they may seem.”

Make sure that you evaluate your progress often. This doesn’t just mean that you set up payments during the month, but it means that you have to take time to analyze your current situation in relation to your goals. Are you on schedule to fund your savings accounts? Will your debt be paid off in time? Will you have enough to make that big purchase?

As long as you are being focused and disciplined in your decisions, don’t get down about not making quick progress (remember to “know your limits”). Instead, use that time to celebrate small victories (such as paying off a credit card, or bringing a savings account up to a particular milestone)!

Take Care of Yourself

“Maintain healthy habits and stay active to the best of your ability.”

No one is going to care about your financial situation as much as you (well, theoretically)! Therefore, you need to be fully invested in your financial well-being. That means that you must do everything in your power to foster financial discipline in your life.

There is no point in evaluating all of these areas, seeking wise counsel, setting up various accounts, and dedicating your time and energy toward righting your financial ship, if you are just going to give up!

You must realize that having healthy finances goes against everything that we are taught in this country; so it is going to take a lifetime commitment in order to see this through.