How do you start to rebuild your financial life after it has been ruined by a recession, identity theft, medical hardship, divorce, or a host of other problems that may come your way? If things are not going well in our financial lives, things can quickly feel overwhelming. Many people often find themselves feeling what may seem like insurmountable obstacles like piles of debt, low income, constant dips into your emergency fund, etc.
Where do you start to rebuild? Here are some things to consider…
Want To Change. Like an alcoholic or a person addicted to spending money with credit cards. You have to recognize that you have a problem. And, you have to want to change your circumstances. That is the first step.
Ease Up On Spending. When you finally realize that you have a problem, now is the time to take a spending break. Can you go a week or two without spending at all? Do you have a written budget where every dollar you make has a specific purpose? Track your spending down to the very penny. You may be able to find small places where you can save some money.
Increase Your Income. Many people just focus on the savings part of the financial equation. Frugality is in vogue right now, and everyone is trying to find ways to save a buck. But, your money problems can also be alleviated with more income to start with. Many people think that your money can have more bang for the buck on the earning side of the equation. So, do not be afraid to look for a second job. Dave Ramsey always recommends getting a pizza delivery job at night as a great second source of income. This route may not be possible for everyone, but it is a great option to consider to help you with your financial burdens.
Sell Your Stuff. How can you raise money quickly without tacking on more credit card debt? You can sell your stuff. You can sell financial assets. You can see a car to help ease your troubles. Don’t write off what you can sell on sites like eBay and Half.com. You can earn a lot of money by cleaning out your closet and garage. Do you really need a bookshelf full of novels you will never read again?
Increase Your Edge. Are you the best person at your job with respect to your chosen profession? Do your coworkers and supervisors seek you out for your knowledge? You should strive to be the best person at your specific job. So, if you are a car mechanic for example, you should strive to be the best one at your work. You should constantly strive to learn more and more about your job either through courses, education, reading books, reading professional magazines and journals, blogs, etc. The more valuable you are to your employer the better.
Instead of becoming overwhelmed in our financial situations, it is best to take a step back and assess things. How can you help dig yourself out of whatever problems you face? You can do it. It is not insurmountable, but only you can start the process. You have to want to do it. Finding out where to start is the hardest part.