In my last blog post, I talked about your money mindset and how money is simply energy.
The energy you give to money is what you will get back.
If you come from a place of lack, then you will never have enough.
Creating that awareness about your beliefs about money is so important, especially when we talk about debt because your debt is a reflection of your money mindset and beliefs about money.
It is also a reflection of your life.
I bet you aren’t just in debt financially, but also in other areas of your life.
I know this because I have been there.
MY JOURNEY
During my first marriage, my husband had trouble holding down a job but had NO trouble spending all of the money.
We shared an account and he would spend so much sometimes that our mortgage payment would bounce.
He never had any regard for the things that needed to be paid when it came to what he wanted.
And worst of all, there was never any communication about what he was buying until after it was done.
This left me scrambling to figure out how to make ends meet, which in turn, caused me to rack up more debt on my credit cards.
This took a toll on my mental and physical health.
This also was the catalyst in my journey with anxiety and depression.
I had no idea that my relationship with money was so negative and had impacted me so deeply the way that it had.
So, we had to file bankruptcy and soon after that, ended up divorcing.
Tell me if this sounds familiar.
You work a job and you work hard, living paycheck to paycheck.
You want more, and so you start to stress about how you are going to get more money.
Then something happens…a big financial blow.
You then have to take out credit in order to cover the cost.
Now, your already stretched paycheck, which is barely enough to get by, has to now be allocated to pay toward your new debt.
Then, something spectacular happens…you qualify for a credit card because of the credit you took out for that financial blow.
So you get the credit card and tell yourself it’s for emergencies only.
And now, you don’t have enough money from your paycheck because you have your existing expenses and you are paying off that financial blow.
So you start using the credit card.
Now, you are so stressed and overwhelmed that you start to panic and look for other ways to earn money.
You start working another one or two jobs.
You start to feel better about your financial situation.
But now you are completely exhausted, still overwhelmed, and it’s starting to affect your mental and physical health and your relationships.
And now, you are stuck and have no idea how you are going to get out.
This was me, ladies!
I had so much debt that I actually had to file bankruptcy right before my first marriage ended.
And after that, I promised myself that I would NEVER allow myself to get to that point again.
And it took some work.
I needed to figure out a way to keep myself from repeating the same pattern.
Then, I met my new husband and I was terrified of going down that same path.
He is nothing like my first husband.
But I was still holding onto that fear.
I made it clear to him that I would never again spend my relationship fighting and worrying about my financial situation.
He was in 100% agreement so we decided that we would keep separate bank accounts but contribute equally to our household every month.
Still to this day, after 13 years, we still have our own accounts and a house account that we contribute to for the monthly bills.
We consult each other on all of the big purchases and support each other in getting the things that we want.
We don’t fight about money…EVER!
Recovering from bankruptcy was a long road but during that time I really started to work on my relationship with money.
I also learned how to create a budget because knowing how you are spending your money is a key tool in eliminating and keeping your debt under control.
I still have debt, but it is minimal.
In fact, I only have 2 credit cards and one line of credit.
Both credit cards are paid off monthly (one a personal card and one is for my business).
The line of credit has 6 months interest free for my purchases so I pay that off as quick as I can before the 6 months and ONLY use it for bigger purchases for my business such as training courses and such.
My house is the only debt I carry.
I can also contribute monthly to my 401k and my savings account.
I can confidently say that I have my financial house in order.
And I want to share with you how you can get your financial house in order which, in turn, will relieve some stress and that overwhelm.
GET YOUR FINANCIAL HOUSE IN ORDER
First things first.
You need to get clear on where your money goes and what your debt actually is.
If you are like I was, I avoided this at all costs because it would cause me so much anxiety to even think about it, so I just paid things as they came in and wished for that big money bag to drop out of the sky.
So, I created a budget and a plan.
This is my step-by-step plan:
- Make a list of ALL of your monthly expenses, when they are due, and how they are paid (you may have some things that recur on a credit card so include those as well).
- This step will tell you where your money is going every month.
- This is your budget and should be reviewed monthly.
- Make a list of all of your debt (this includes car notes, credit cards, loans, etc.) including the total balance, minimum due, how much you actually pay per month, and the interest rates.
- Write down your TAKE HOME pay. The actual money you have coming in each month.
- Take your monthly expenses (don’t forget gas, groceries, gym memberships, etc.) and subtract it from the money you are bringing in.
- This tells you how much money you have leftover (don’t worry if it isn’t very much because this process does not create any added expense to you).
- Now, look at your monthly expenses. What can you eliminate?
- That daily coffee run-you can make coffee at home.
- That gym membership-you can work out at home.
- Cable-look into more affordable streaming options.
- How much did you eliminate? This money will be used to pay off your debt.
- Next, look at your debt. What can you pay off first?
- If you have several credit cards, STOP using them. GET RID OF THEM AND CANCEL THEM! I know I had every retail credit card as well as 3 major credit cards. You don’t need these!
- Retail credit cards tend to carry the highest interest rates so those definitely need to go first.
- Once you start to pay these off, you will notice your mindset start to shift and you will feel a sense of control and accomplishment.
- Once you pay one of those off, you take THAT money and add it to the money you are paying on one of the others so that you are paying more toward one than you previously were.
- This way you will not be paying anything more out month-to-month
- When that next one is paid off, move the next debt item and use the TOTAL amount you were paying to pay off the previous 2 and apply to the third.
- Then, rinse and repeat until all of it is paid.
And that’s it!
The key here is to NOT incur more debt as you go so you MUST stop using the credit cards, lines of credit, etc. during the process.
When this is all said and done, you can now start putting the money you were paying toward your debt into savings so that you have nest egg for when the next financial blow happens and you won’t have to repeat the same cycle.
The hardest about all of this is being comfortable with feeling uncomfortable about what is really happening in your financial house.
It’s really simple, but it won’t be easy, and I am here for you.
Remember your money affirmations and your money gratitude I talked about during the entire process because this will keep you in a higher, resonating state so that you can attract everything you desire.
You need to keep that money energy flow moving in a positive direction.
If you would like some help getting your financial house in order, I am happy to help you get started.
My goal is to help you eliminate that stress and overwhelm so that you can have all of the abundance money brings.
