Before I decided to get out of debt, I was living a pretty delusional life of high-interest cash advances, credit cards and spendthrift ways. I was basically in denial of my debt and unable to recognize I even had a problem.
Now, I am no dummy even though I have done some pretty stupid things with money. Among them: buying a car that cost almost as much as my take-home salary and taking out loans to pay for rent. Ridiculous! I knew that debt was accumulating – but I didn’t really know the ramifications of it and the consequences of my choices. In some ways, I thought money just grew on trees and all I needed was a “break”. That break really never came.
Fortunately for me – I did come to my senses. Had I not encountered some pretty tough personal issues – I may have never woke up to my financial problems.
The first step…
Whenever you are tackling any problem – you need to know what you are facing. You need to be in reality. As long as you live in a delusional state – your problem(s) will never be resolved.
In order to see your problem – you may need to encounter one of the following.
- Someone points out the problem to you
- A crisis awakens you to the problem (what happened to me)
- You become self-aware
I happen to think that most people become enlightened through “crisis”. The bank calls and wants to repossess the car, the grocery store rejects your credit card, or you are back living with your parents again.
It’s unfortunate – but this is what it usually takes for us to wake-up. At the time, my wake-up call was devastating. But looking back on it – it was one of the best things that could have happened to me. In time, you will feel the same - if you let your crisis lead you to change.
Recognition is the key
Once you recognize your own money issue (the debt is too high, I can’t afford this house, I’m debt broke – again) – you are on the path back to debt freedom.
Try and understand how and why you got here. What were some of the actions that led you to this point in your life? What are your beliefs about money? Why do you think you made these poor decisions?
More often than not – our choices with regards to money reflect a systemic problem in our values and beliefs that need adjusting.
Money is more “mental” than we often think. Make sure you get squared away with the issues surrounding your problems with money before you move forward.
Do you know your money issues and why you are where you are? Do you own and take responsibility for your money problems?