Wealthy Turtle

Do You Lie to Yourself About Your Finances?

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Back in the day, I loved watching Everybody Loves Raymond.  There was one episode in particular called The Checkbook that still sticks with me.  Debra does all the money management and budgeting for the household, and Raymond finds out that Debra had borrowed money’s from Ray’s parents to make ends meet one month.  Ray is upset and thinks that Debra is not doing a good job with the budgeting, so he insists on taking over.

Things seem to be going smoothly, and Debra is relieved to be free of her budgeting duties . . .until the lights go off one night.  Turns out, Raymond had been making a mess of the checking account from the beginning, so he created a separate second check registry so Debra would think everything was fine.

In the end, when Debra sits down with Raymond to fix the mess, he confesses that there’s yet one more check registry he’s kept from her.  Hours later, the mess is finally cleaned up, and Debra takes over financial responsibilities for the family once more.

The Lies Will Catch Up with You

Are you like Raymond sometimes?  Do you lie to yourself about your finances?  Do you insist that things are not that bad even though you have credit card debt or have no emergency fund?

No matter how many lies you tell yourself, just like Raymond’s experience, the time will come when you’re faced with reality.  In Raymond’s case, his reality came when the lights were shut off.

In our own family, we lied to ourselves that we could afford parochial school for our son.  That lie cost us thousands of dollars we really couldn’t afford.  Thankfully, when our youngest two were scheduled to also enter the parochial school, we did the math and finally faced reality.  Now, we homeschool.

Face Financial Reality

We’re only days away from 2014.  If you’ve been lying to yourself about your financial situation, why not make this the year that you face the truth?

Take a few hours and write down exactly how much debt you have, what assets you have, and how much income you have every month.

The whole exercise might be painful, but at least you’ll be honest with yourself.

Take Steps to Improve Your Situation

Once you see your complete financial picture, take the steps to improve your finances.

First, slash whatever expenses you can.  Perhaps get rid of your home phone and get an Ooma instead.  Call your insurance company, your cable company, and your credit card company to negotiate monthly payments and interest rates that you pay.

Sell the extra stuff in your house.  We all have “clutter” that someone else may find useful.  Sell that stuff on Craigslist, eBay, or a Facebook group.

Get a side gig.  Find a side gig that can help you bring in extra money to help you pay down debt faster or increase savings.  Thanks to the Internet, there are many jobs that you can do online in your free time.

Let 2014 be the year you face financial reality.  You’ll be in a much better financial position at this time next year if you do.

What is the biggest financial lie you tell yourself?

Digging Yourself Out of Debt

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Are you having trouble paying your bills?  Receiving calls from debt collectors?  Worried about losing your home?

You’re not alone.  Millions of people are deep in debt and struggling to stay afloat.  Whether your debt stems from the loss of a job, a family illness, or overspending…it can be pretty overwhelming.  But no matter how deep of a hole you are in, there is usually a debt solution that can help you dig out.

Let’s talk about a few of your options.

Developing a Budget.  The first step to taking control of your finances is to sit down and size up your situation.  Make a list of all of your income and then make another list of all your expenses.  If your expenses are more than your current income, you’ve got your work cut out for you.  You need to ruthlessly cut out as many expenses as you can until you get your spending in line.  You should also look for ways to increase your income (a part-time job, a side gig, etc).

Contacting Your Creditors.  Gather up a list of all your bills and make a list of all your creditors, how much you owe them, the current interest rate, and how far behind you are on your payments.  Give each of them a call and let them know that you’re having trouble making ends meet.  Explain your situation to them and try to work out a modified payment plan that reduces your payments to a more manageable level.  You’ll need to do this before the creditor hands your account over to a debt collector.

Credit Counseling.  If you don’t think you can get out of debt on your own, consider contacting a credit counseling organization.  A reputable credit counselor can help you develop a budget, teach you basic money management skills, and work out a personalized debt solution for you.

Debt Management Plan.  Depending on your circumstances, a credit counselor might suggest you enroll in a debt management plan.  In a debt management plan, you send money to the credit counseling agency each month and they use it to pay your bills for you through a payment schedule they work out between you and your creditors.  They usually try to get your creditors to lower interest rates and waive certain fees as well.  While a debt management plan might not be best for everyone, it is a viable option for people with serious debt problems.