It is a tough road ahead as you try and overcome financial challenges in life. On top of this, there are a lot of things that can complicate the problem. For one, what you are experiencing might be a first for you. It can be a first mortgage payment hiccup, credit card problems, or even losing your first job.
You might also be going through multiple debt problems all at the same time. As if one is not hard enough, dealing with a lot of them simultaneously can take its toll on you. And it is not just about financial problems, they can be a mix of personal and even professional struggles. Combine all these together and you have a flurry of challenges that can easily take you out for the count.
To add salt to injury, households have an average of $132,500 debt according to a recent article by Bloomberg. This includes mortgage loan, student loans, auto loans, credit card debt and others. This is a big number to have on your shoulders. These are the types of debt that can shape you into a better person or send you down the path of repetitive debt.
Your desire to overcome financial challenges is a great start in helping you steer your finances to the right direction. Here are a few things to help you achieve just that.
Go back to basics
It can be overwhelming. Once you sit down and start to look at all your financial obligations, you could be faced with a harsh reality. You might even start to question your decision-making skills as you ponder how you let yourself acquire so much debt. At this point in your journey, it is a good idea to go back to financial basics.
One of the reasons why you are starting to have a tough time managing debt is because everything seems too complicated. A lot of different payment amounts, various lenders, multiple interest rates and even due dates. With this, it makes sense to simplify things and go back to financial basics.
This can be as simple as using cash rather than your card. This helps lessen the chances of impulsive purchases. It can also be a matter of philosophy – do not buy items you cannot afford. When it comes to payment, try to consolidate your debt accounts. Doing so helps you combine everything under one account. As you do this, it simplifies your repayment giving you one payment amount, one due date and even a single interest rate to think about.
Look at the big picture
When you start to feel disheartened with the amount you have to tackle, try looking at the big picture as well. One thing that can help you put things in perspective is your net worth. This includes jotting down whatever money you have in the bank and even the current value of your investments. You also need to put down the value of your car as well as house into that amount. Don’t forget any pieces of jewelry and even the cash value of insurance policies.
Once you round up this number, you might be surprised at how much you have. This can give you a sigh of relief and comfort knowing that your net worth is not that far from your debt. There might even be times when your net worth is more than you total debt amount. It might just be a matter of managing your finances to get back on track.
Remember your long-term goals
One way to overcome financial challenges is to set your sights on your long-term goals. This can help remind you why you are doing the things you do. As you max out your 401(k) contribution every year, try to remember that your goal is to retire at an early age. If you are trying to pay down your mortgage loan aggressively, try to remember that you want to pay off the house as early as possible.
Your long-term goals can be a great reminder of why you are working so hard to overcome financial challenges in life. As that happens, you get to feel a certain sense of purpose in the things you do.
Take a break
It is possible that you simply need a break so you can rest and recharge your mind and body. This can also help you overcome financial challenges. This is because you get to make better decisions when you are not stressed out. You get to process data and various information better. This results in better management of your finances and debt payments.
When taking a break, it does not mean booking the next flight out and spending weeks in a remote beach hundreds of miles away. As tempting as that is, you need to make sensible decisions even with your vacation. A break can even be a day of just staying at home and catching up on sleep. It can also be a walk in the park or lunch out with your best friends. The important thing is you get to relax and rest your mind away from your troubles.
Get some help
Push comes to shove, you can seek professional help in order to overcome the financial challenges in your life. There are individual financial advisors or even legitimate companies that can help you stay on top of your financial obligations. The important part in taking on professional services is to know who you are dealing with. Forbes recently shared that there are things financial advisors might be holding back information from their clients.
As you look for financial advisors or even companies to help you overcome financial challenges, look for partners you can trust. It can come from referrals or even through online research. Look for positive feedback from past customers because this is a great barometer of customer service. It also helps if they have part of any industry associations that regulates members. These are some of the qualities that will help you choose the right company to work with.
Overcome financial challenges by believing it will get better
Debt problems, like most challenges in life, will come to pass. What is left are lessons and memories to help you do better in case it comes back around. However, this should not be a basis for complacency. You still need to exert as much effort as possible to resolve and overcome financial challenges. This is the best way to learn from adversities in life.
Acknowledge there are things you cannot control
There are instances when you are too stressed about a lot of things in your life including your finances. The problem with some of them is that you are focused on the things that you cannot change. Rather than constant worrying how prices keep on increasing, put your energy in areas you can control. This can be increasing your income and lowering your expenses.
These are just some of the things you can do to help you overcome financial challenges in your life. Once you get over these hurdles in your way, you become a better, wiser and stronger version of yourself. When you encounter the same problems in the future, you already know what to do about it.