Desperate Times
Posted by Gail | Filed under Credit Wise
As the show becomes more popular and more people find my website, the number of desperate letters from people are increasing. Some bodies can’t figure out how to even get started digging out. I can’t possibly answer all the questions I receive, so I’m hoping that this will help y’all.
1. Breathe. If you’re so desperate you’re considering jumping out of a window, you need to breathe. Financial despair isn’t anything new, and while it may feel like the end of the world to you, it’s not. As long as you’re breathing, you can decide this is the point at which you draw a line in the sand and take control of your money and your life. When things get desperate financially, people stop looking at what they have that’s good (a job, a family that loves you, beautiful children, a great community…) and see only the hole. That’s neither constructive nor motivating. And it won’t solve anything. So breathe, know that what you have to do next will be very hard, and then get busy.
2. Tell. You have to tell people what you’ve done – the mistakes you’ve made –and what you’re going to do: your plan. This may be the hardest part. People like to hide their mistakes like dirty little secrets. Doing so let’s them fester. You’ve got to lance your shame and, holding your head high because now you have a plan, face up and ‘fess up. Telling will not only help you work through things you may not yet be clear about, it often leads to good ideas on how to fix problems. And it let’s others know that you need help (no, I’m not talking about money, I’m talking about emotional support.) Whenever I give this challenge to my couples they twist in the wind until the dirty deed is done, and then they experience huge amounts of relief because they’re not pretending anymore.
3. Ask. People are loath to ask for help. Whether it’s social assistance, help from a neighbour, or help from family and friends, we don’t like to ask. But if you don’t ask, you may be missing out on opportunities that could make things even slightly easier. Are there social benefits that could provide some help? There are Rent Bank programs like this one in Ontario that gives short-term funding to low-income tenants who need financial assistance to address short-term rent arrears. Canada Benefits is a great site for finding what you may need in the way of help. You should also check with your local commuity organizations and churches which are great sources of help during tough times.
4. Sell. In our new age of We’ve Got Everything, you probably have stuff you can sell. This is another of those challenges people balk at. Sell my stuff? What am I without my stuff? What you’ll be is closer to a solution. If it’s money you need to get you to a better place, focus on that; turn your clutter into cash and execute your plan. Stop thinking your stuff defines you. It doesn’t. Your ability to take care of yourself and your family speak far louder than the car you drive or your big screen TV.
5. Focus. You’re likely in debt and getting rid of that debt needs to take priority over everything else right now. Walking around with an albatross of debt around your neck is not only financially crippling, it’s emotionally exhausting. If you can’t possibly make your payments, bankruptcy may be your only option. Go and see a bankruptcy trustee. If you can squeeze through this tough spot, call and negotiate with your creditors to reduce the amount you have to pay and stop the interest clock from ticking. Stop using all your credit. Cut your expenses back to the bone. Find ways to make more money. Make a debt repayment plan that will get you out of the hole, finally. Do whatever it takes.
6. Believe. Getting through a tough financial period can be one of the most stressful things you will ever deal with. If you need someone to talk to while you work through Debt Hell, find a friend or family member who will be willing to listen to you vent. You aren’t asking for advice, you’re blowing off steam. Maybe that person will be willing to start walking, running, swimming, working out with you regularly so you can vent physically and emotionally.
This crisis is your opportunity to prove what stuff you’re made of. Are you full of straw, flopping around in the winds of change? Or are you made of steel, strong and determined to hold true to your new course?
Don’t doubt your ability to make the life you want. You CAN do it. If you want to badly enough.
July 10, 2009 at 9:34 am
Thank you Gail! This post is exactly what I needed to hear right now. I’ve been feeling a little less than motivated lately. But I have to remain focused! I know I will get through this and it may not happen as fast as I would like it to, but it WILL happen!
See you tomorrow at the picnic!
July 10, 2009 at 10:24 am
Great Post Gail!
I can only imagine how many questions and pleas you get for help each and every day. It puts things in perspective when you realize there are so many people out there who need help, are in trouble, and don’t know what to do.
Makes my little pile of consumer debt/student loans look so small.
July 10, 2009 at 11:30 am
and please don’t forget…STOP using the credit cards!!!
July 10, 2009 at 12:06 pm
You are so right, Gail.
So many people are getting caught with their financial pants down. And the first instinct is to panic. But we all know that is not the best thing to do.
I can’t imagine the number of requests you’ve been getting. You could probably do episodes of TDDUP for another 7 years and still not have gotten to every one.
Personally, I would never have thought that in a timeframe of under 3 years, my earnings would be down by a third. I think the thing that has saved us, my husband and i, is the fact that our expenses are not as high as they could have easily been. This is one time when procrastination on the part of my husband is good. Our hours started dropping before we bought a second vehicle or a boat. Being frugal, and having less ‘wants’ helped too.
Each one of your six points is well made. And they DO work. I have been able to apply them all to our situation, with the exception of number 3, ‘ask’. It’s not that I am afraid to ask, it’s just that I’ve not needed to. Executing the other five points took care of that one.
July 10, 2009 at 12:22 pm
I think for the people this really hits home to, who feel they really need some support, or a gentle (or not so gentle) push to get started, joining their local Gail’s Club may be a good start! Having other people to talk to who are in similar situations, or at least on the same path as you are (wanting to spend less, save more, and pay of debts) is extremely beneficial. As odd as it is, sometimes its easier to confide these things to strangers rather than friends or family. It is unbiased.
Check out the Gail’s Club site and join the group near you! (there is also an online one).
July 10, 2009 at 2:52 pm
For most of the people I know who are/were in debt including ourselves that debt did not just suddenly appear. It started small and grew and grew – just like a snow ball rolling down a hill grows from something the size of an orange to something big enough to knock you over and bury you alive.
Debt – particularly large debt – seems insurmountable when you first start paying it down. But it too becomes a snow ball.
During the first few months of our debt pay down it seemed like nothing was changing – and certainly not fast enough – but once we got caught up with our over due bills and kept them current we started to see the change. The extra money that we had been paying to the utility companies got redirected to a credit card and in two payments that card was gone. Then all that money went to another debt and in 4 months it too was history.
You just have to keep going and have patience. When we looked back a year from the day we started we were sooooo amazed and happy. But it took another 2 years to get to zero. Oh well – we weren’t going anywhere for those two years anyways.
July 10, 2009 at 2:54 pm
Gail, you are doing such a great service to us all by being honest and to-the-point, and wording it in an understandable way!
When the panic sets in it’s hard to remember that it may take some time to dig out of it…. likely these folks didn’t get in over their heads overnight, and they won’t get out overnight either.
I know so many people that are on the precipice of bankrupcy, and feeling so desperate — but ironically it is those same people that when I suggest they quit smoking (hard) or cut cable, internet and cell phones (easy) they balk and say “that’s never going to happen”!!!! Come on! Really? Priorities can be so warped even when people are feeling broke.
Money is an emotional device, but really it’s not rocket science to evaluate the difference between a want and a need. Good food and warm shelter, safety and love are needs…. but entertainment is always a want! Very expensive when you are stuggling financially.(I even had a friend that had NO phone at all for most of her life!!! Can you imagine? No phone!)
July 10, 2009 at 4:48 pm
@Elizabeth – Gail had a great little post recently about the pros of using credit cards provided you are good with them and only use them when you have the money to pay them off.
July 10, 2009 at 5:56 pm
Fantastic advice! Looking forward to meeting fellow bloggers at the pot luck tomorrow! Let’s hope for nice weather… despite the call for thunderstorms!
July 10, 2009 at 7:31 pm
Another excellent message Gail. Even though each of us knows that we have to creep before we can walk…as Maureen states debt starts small and grows and grows over time…we have to take that breath and not think we can pay everything off all at once…and creep along and get rid of it slowly, probably over the same amount of time!?!?!?!
Wishing all those meeting tomorrow a wonderful day together! Hope the sun shines on you all…I’m sending cyber hugs…maybe I can make the next get-together.
July 10, 2009 at 9:24 pm
#2 IS very hard, but it’s VERY worthwhile! Not too long ago I got up the guts to write a post on my personal blog about our financial mess-ups and what we’re doing about them. I’m SO glad that I did. I was sure I’d experience sneering remarks and rejection, but instead I had several friends tell me that my honestly helped motivate them to face up to their own fiancial problems! Along with releasing the burden of hiding our real situation, I also found support and an incredible outpouring of love from people who had thought that they were alone in their financial mess. Now I’m far more motivated to stay on track, too, since I’ve committed to keep writing about our progress.