One of my readers emailed me about the tough financial time he is going through right now, and asked for some words of advice on how to handle and survive it.
Indeed, a great instigator of anxiety is money. Money can’t buy love and happiness, but none of it – or lack of it – does bring worry and apprehension especially when there are bills to pay.
It’s easy to be happy when everything is going well financially. But what about when you’re going through a period of deficiency, or a financial emergency, or an urgent need? What can you do at that moment?
Do you sulk, surrender, and die? Do you wait for cash to rain from the sky? Do you go into debt? Or do you just ignore all your financial responsibilities and sleep all day long?
Fortunately, our family is kind of going through some tough financial times as well, so I was able to share to him some of the principles that I’ve been personally learning these days.
Here they are:
1. Focus on the essentials
A simple life allowed our family to survive this rough month financially. Because we have such minimum needs and expenses, we were able to cope up with the unforeseen costs that came our way.
Some people find it hard to believe how I, as a freelance writer, am able to successfully support my wife and two growing kids. The secret is we cut back on our expenses and focused only on our essentials.
Examine your spending habits right now. Are there non-essential expenditures which you can eliminate? Do you really need to have daily overpriced latte from your favorite coffee shop? Or five monthly cell phone payments when only two people are using them?
2. Increase your income
Eliminating non-essential expenses is only half of the solution. Earning more allows you to have more flexibility and gives you an easier time working on a tight budget.
To deal with our unusually large financial requirements this month, I’ve taken more freelance writing jobs than usual. It is different for everyone, but the principle here is to be observant on opportunities to earn money.
Aside from your day job, why not try freelancing or consulting as part-time? Do you have a passion or talent such as baking, cleaning, or playing musical instruments? You can start selling your pastries, offer private cleaning services, or teach kids to play the guitar.
Conducting a garage sale is also a great way to earn some money. It gives you the opportunity to declutter and simplify your home at the same time.
3. Don’t go into debt
As much as possible avoid credit if you don’t have a solid plan on how to pay it. Going into debt is perhaps the easiest solution to money problems, but it also comes with a lot of dangers. It is easy to go deeper and get trapped into debt once you are in it.
Arguably, the only good reasons to go into debt are when there is a family medical emergency or if you are starting a new business. Aside from that you are risking your peace of mind.
Also, remember that the borrower is slave to the lender. So if you want to keep your integrity to people, avoid going into debt.
4. Realize that it is temporary
Finally, you have to realize that everything, even money problems, is temporary. Sooner or later these things will all go away.
Picturing that impending success actually allows you to gather strength in facing your current financial debacles. It also lets you think clearly and rationally in formulating the best possible solutions to your problem.