“Transaction declined; insufficient funds.”
Oh, the mortification of seeing those four words on the screen before me. Again.
I wondered anew how it could be that, despite the outside world seeing a woman who was successfully managing a highly profitable branch of an international business, my inner self knew that I was hopelessly unprepared (and unwilling) to take responsibility for managing my personal finances beyond the next payday.
The reason was simple enough. I had previously been married for 10 years, during which time there were two reasonable salaries and always sufficient money, and credit cards, to make our world go around very nicely, thank you.
But when I left my husband, I left my financial safety net behind me too – deliberately, but naively. I returned to New Zealand with only two well-stuffed suitcases and carried on spending as though nothing had changed.
The impact was considerable: negative self talk, loss of sleep and literally being so fearful of opening the mail that I would put all the brown envelopes (as they were in those days) unopened, in a drawer used only for that purpose – talk about denial!
Looking back, I suspect that deep down I was waiting to be rescued, though exactly whom I expected to ride along on a white horse and do so remains a bit of a mystery. Perhaps a kindly goose would lay me a golden egg?
I got so t-i-r-e-d of waiting for the axe to fall that it was a relief when it finally did, by way of a debt collector arriving on my doorstep just after I discovered that my phone and power had been cut off, on a cold winter night.
So there it was. A mess of my own making and no way out of it but to pull on my big girl panties, grow up, behave like the smart woman I was during working hours and make it right.
And so I did. Despite it being overwhelming just finding a place to start, two years later I saw light, glorious light, at the end of the tunnel (cue trumpets sounding!) And my sense of achievement was worth every lesson I learned along the way and honestly, it still is.
If this resonates with you, here are 4 of the first basic, but proven, techniques I recommend:
- First, find your ‘why’
Get very, very clear about why you want to make changes. Just saying “I want to improve my situation” is not compelling enough to sustain change. Ground it in your emotions and it’s much more likely to stick.
After much soul searching I realised that my ‘why’ was that I wanted to know, with ever fibre of my being, that I was just as capable in my personal financial decisions as I was in my business ones. At an emotional level, I wanted to never, ever feel embarrassed or ashamed about my relationship with money again. Years later, I can still recall that sickening feeling, although I’ve not actually experienced it since.
- Open the damn envelopes! 🙂
- Treat your money as you would a good friend
Pay attention to it i.e. read your bank and credit card statements. Care for and treat money with respect i.e. don’t just toss your cash and cards anywhere, give them a proper home. Having an uncluttered, organised wallet subliminally reinforces that you are organised with your money. (If you have one you enjoy looking at, even better). May sound woo woo but it works!
- Use cash, not cards
Cards make it too easy to miss what, and how much, you are spending. And if you don’t read your statements, you can rack up a lot of debt without really noticing. Taking cash out of your beautifully organised wallet will increase your awareness of what you are doing. And if you adopt a ‘cash only’ policy, you are likely to choose what you spend that cash on more wisely because when it’s gone, it’s all gone!
- Record where your money goes
Without judging or beating yourself up, track every single cent for a month. Don’t wait till you get home to put it on a spreadsheet, write it in a notebook as soon as you have spent it. Depending on the way you like to capture information, create some categories for what you’ve spent (e.g. coffee; dining out; takeaways; phone; alcohol; clothes; petrol; entertainment; books; gifts; gardening stuff – whatever makes sense to you). Some people like to write all the amounts in one list and then sort it into categories at the end of the month. Others may prefer to record directly into the relevant category as you go along. It doesn’t matter how you do it, just do it!
At the end of the month, critically evaluate where your money has actually gone and see what changes you want to make. And make them, forthwith!
I had a vague idea that a little of my discretionary, ahem, money was being spent on takeaway dinner because I couldn’t be bothered cooking for one. However it actually turned out to be a large chunk of money. Getting take-out food had become a habit. Making it a treat instead helped to make a real dent in the credit card bill.
To be continued…
The bottom line? When it comes to money matters, ignorance is NOT bliss. Nor is it an excuse. Be smart – start making money your friend today.
Is your relationship with money fear-filled or friendly?
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