Dec 17th, 2012 by Jennifer Lynn
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Have you gone buck wild with your finances and now you are broke and dwelling in the poor house with threadbare pockets? Financial responsibility begins with you. Now is the time to stop making excuses and derailing your financial progress. Here is how to steer your paltry finances back on track to begin paving the way to riches and financial prosperity, proactively.
Aim for financial stability. Practice these simple adages that warrant repeating because they are so important, such as: spend less than you earn and save up an emergency fund, etc. Yes, it really is that simple. You will never get to the good stuff of wealth accumulation until these first two steps are conquered and you can place yourself on firmer financial ground to plant fertile seeds of prosperity.
Negotiate debt repayments. Debt is like quicksand gobbling up any type of financial progress unless your debt is providing passive income streams (such as a mortgage on an income property). If your debts are sucking the life out of your wallet, you’re sinking down a slippery deep hole of stagnation. Contact each of your debtors and try to re-negotiate a payment plan that will allow a bit more flexibility and financial wiggle room and, as a sign of good faith, be sure to stay on top of each payment and contact debtors immediately if you know you may be late on a payment. Show a willingness to responsibly work through the situation with your debtors and then focus on aggressively vanquishing each of your debt beasts.
Stop spending strictly for today. By utilizing credit today, you are using your future earnings and future life energy to deprive yourself of tomorrow. Doesn’t make much sense, does it? Instead stay out of the vicious debt trap by saving first for the items and experiences you crave. If you don’t have the money, don’t buy it!
Step away from a mindless consumerism mentality through more conscious spending. Be aware of each purchase and only buy what you truly love. Try to adopt a more minimalist lifestyle and eradicate all of the useless clutter in your life.
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Many people don’t even imagine that debt is negotiable. If you are in real financial distress your lenders should be willing to help.
This all makes sense but…I have noticed that it is very important to distinguish between the short and the log run. Most of what you mention is great in the long run. Stabilising the immediate situation usually takes quick thinking, sacrifice and extraordinary actioned flying in the face of responsible personal finance.
Like Pauline says many don’t know debt is negotiable. Many people don’t think to call up the credit card companies and explain the situation to a Manager and ask for a lowered interest rate. It all adds up. Mr.CBB
Exactly! By spending today using credit you are enslaving yourself!
Hi, when you go to vote on your blog do you have to scroll thru all those other blogs, I couldn’t find Broke Ass>
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Hi guys, oof, I am so behind with responding to comments right now.
)
@Pauline, yes, lenders are running a business for profit and they would much rather soak up what they can rather than risk a complete default from you. In any event it never hurts to open the lines of communication and attempt negotiation.
@Maria, that is very true. In the short term if my family required food or I could not pay rent, for example, I would not pay any credit card debt before those extreme situations were stabilized (through contacting and communicating with the landlord, for example, or by reaching out to charitable organizations dedicated to helping those temporarily in dire straits.) However many turn to payday loans or credit lines: borrowing money to pay off debt is ludicrous! It is only exacerbating and compounding on the problem instead of reaching the root of it. One of my favorite financial sayings is: do not throw good money after bad.
@CBB, if a lender sees a sincere effort to pay, they very well may offer a temporary hardship negotiation. It never hurts to ask.
@Marvin, I am astounded by how many people can not grasp that debt = indentured servitude. You willingly become chattel for Mastercard, Visa, JPMorgan, etc. when accepting a loan from them.
@Debtgirl, no need to scroll through, my dear, as each click counts as a vote. Every time you click on the ‘vote for me’ banner from here, Broke-Ass Mommy automatically receives a vote from you and moves up in the rankings. A new vote may be cast every 24 hours. (And, thank you!!
Great tips! Especially for the negotiation of debt repayments. That’s one that a lot of people don’t know about. Voting for you, Top Mommy.
I plan out my money at the beginning of each month, the standard bills, and the possible upcoming expenses… I don’t tend to run out at the end. There isn’t a lot of surplus, but there isn’t any debt either
Not having enough money at the end of each month often reveals a great issue at hand (more of a long-term problem) and not just a single instance. People that live paycheck-to-paycheck often have a few solutions: decrease how much they’re spending, pay off debt, or make more money!
Good tips! And sweet giveaway!
Great thoughts Jennifer! I like your take on stepping away from spending. For some that can be a tough cycle to break as I know it was for me. Take a look at what you value and why you’re spending so you can try and take the reigns over your finances.
What drives me crazy are the creditors that refuse to compromise. My local hospital will not take payments at all. It seems odd that they would rather drive a person to bankruptcy and not get any money then slowly collect the money over a year or two.
I definitely negotiated APR reductions back when I was paying off my CC debt–all you have to do is ask; it never hurts to try!
I would try to borrow from a family member.
Totally agree that we can’t simply spend for today. We need to save money for the long-term, there is no way around it for most of us. If we can’t buy something, don’t buy it. Actually, if we CAN buy something, that doesn’t mean that we should!
Saving for the old version of ourselves, thinking about how it must feel to be old and needing money, can be a great motivator
I think you nailed it with “conscious spending” Jenna. If we all practised that, then a lot of peoples money issues would disappear.
My husband own a small business that is very slow this time of year. IF we dont save enough during the busy season we often find ourselves short for a few months. IT is very difficult
use my savings.
this is a common problem for me. I just buy what I need, not what I want, to avoid situations like this.
I would probably look for things to sell around the house on Craigslist/Ebay, etc..
I would borrow money from my family if I’m desperate or get a job.
I would cut some things like cable and such, keeping only necessities and I would borrow money from my parents to pay this months bill and repay with with the savings next month.
Meditate and pray…
I almost always avoid this by planning at each pay cycle on what is due, what is needed and what is had!
I’d probably go job hunting.
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borrow from family
I would see if I could borrow from a family member and if not, try to go without. We’ve been in this situation many times!!
re-evaluate the budget, take odd jobs
Ask either my parents or in-laws, as much as I’d hate that.
Dip into savings!
I would see what things around the house I could sell.
I’d try to sell something first, if that didn’t work I’d ask a relative for a loan.
It would depend. I think by the meaning you are short is that you do not save money and therefore have nothing to fall back on. If it was an on going matter like being short every month, I would watch spending for the months afterwards. In the mean time I can rely on the help of family for a short term loan. Pay back is priority after such loans and for big one’s I would recommend having things in writing. If certain bill’s are late the charges can be pretty big. Late fee’s should be avoided at all cost. I do not rely on credit cards. I have one with no annual fee’s and low interest rate but I think credit cards make you poorer and it is a cash cow for banking institutions. Dealing with people, say your rent is late and telling your landlord, “Hey I am going to be late Flow,” (it helps if you are a good responsible tenant) might be understanding. I would recommend paying something even if it is short a larger amount. I like the LBYM approach to having a good life. If you do not start saving what you earn, you have worked all for nothing.
I would sell what I have to pay the bills. I would then be very careful with spending.
Sell things
I will re-adjust my budget – scrimp on non-essentials, sell things on Ebay, ask help from family/relatives, find an extra-source of income.
I would try and sell things on ebay.
Sometimes I sell items on eBay if I don’t have enough money to pay my bills. I also keep credit card access checks on hand in case I have no other choice but to use my credit cards to pay some bills. Thank you for the chance to win.
I would borrow from my savings and then replace it immediately
I’d postpone purchases.
Run up the credit card.
Well that’s a normal occurrence LOL
I borrow and pay back big fees.
I would sell stuff.
If we were desperate we would ask my family if we didn’t have enough from savings, but we would use our savings before asking for help.
I would definitely give this site a try.
call for possible extensions, donate plasma, sell my comics/dvds
Since I pay my bills first, then purchase things needed with the remainder, I would postpone those purchases until my next check came in.
I would try and get a loan
I’m already there. Being on a fixed income and not being able to work while caring for my husband, we pay what bills we can as soon as his check comes. I use coupons like a crazy lady, enter contests, answer surveys for pay, and recycle and reuse at every chance. Learned do without things like fabric softener and a box of tissue for every room and buy less softer tp. During the summer I had a small garden and winterized the house when I had a few extra dollars. Went to a prepaid phone plan and dropped the landline.
We budget heavily. We used to live paycheck to paycheck, now we don’t but we can’t seem to get more than 500 in our savings at a time, something always happens! It’s like we’ve hit a plateau with our money
Contact creditors by phone and put off paying any that could wait for one more pay period.
If I discovered I wasn’t going to have enough money at the end of the month, I would start selling some stuff online or to consignment stores.
Thanks for the chance to win!
I’d start looking at where more money can be saved, like saving electricity, downgrading the cable package, etc.
I manage on my disability by paying bills before everything else. No credit cards, no TV, $10/mo for phone.
I’d probably ask for a loan until I get the money.
I would look to see what I could cut out of my budget and sell some of my items if I had to.
If I do not have enough for necessities, I look at ways to get money – such as work or selling something. If these are not possible, I get cash from a credit card and deposit it in the bank for bills or to use for necessities. I am also disabled and live very frugally to make ends meet. Interesting blog, thank you for a fresh perspective.
It would depend on what the next months finances looked like. I try to pay off all my debt each month, but if I ended the month and needed groceries, and I knew I could cover that expense the next month, I’d just charge it to my credit card. If I knew I couldn’t cover it, I’d ask family for help or try to trade goods and services with friends/family.
I would try selling something to make some extra cash
This happens to me every month..I spend about two weeks totally broke. How do I cope? I usually just do without..stay in the house and pray for the third of the month.
I re-arrange money often, it happens unfortunately
i would hate to find myself in that situation . i would tap my 401 k
I would take out a couple bills or readjust some bills and call the companies to let them know what day I can pay them on.
Just happened this month. Went without purchasing.
I would try to sell something on eBay or pawn some jewelry – and beef-up my giveaway entries for cash
I would look at what bills don’t charge late fees and delay paying those. Mortgage payments although paid at the beginning of the month typically are not due until mid month before a penalty is incurred.
I’d most likely resort to selling some belongings on eBay or Craigslist first, and then if I’m still short, borrow from trusted friends or family members rather than relying on credit cards or loans.
I would probably borrow the money from my Mom if I were short.
I would try to borrow money from a family member and pay my bills as late as I could without incurring any late fees.
I would sell something or work extra hours to pay the bills
I would sell something and if that still wasn’t enough I would ask a family member for a loan.
My husband can get advances from his employer. We’ve used it a few times.
I’d search the couch cushions! And all my old winter jackets — and purses!
Seriously though, I’d likely borrow the money from my parents.
Not buy un-needed items.
I would only buy the neccessary tiems if I didnt have the funds
items I meant
Stay far far away from payday loans business. They can become a vicious cycle. Start saving and pay yourself.
I will definetly try this site
sell things not being used or needed. Offer cleaning services to neighbours and friend’s.
I’d cry.
I would cut down on other expenses.
I hate how frustrating budgets and bills can be
sell something i didnt need
I only have one credit card and it is my safety net in case I have a financial emergency.
If I found that I didn’t have enough money at the end of the month I would get a second job.
borrow money from a family member
ardy22 at earthlink dot net
I’d ask a friend for a loan
immediately cut back, find out why and find a loan
I would sell something or cry!
We never have enough money at the end of the month. We try to stock out cupboards and make sure we have necessities, but usually just feel like were running on fumes. When this happens, we make due. But once that check comes, we go right out to the store and restock.
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