Breaking the Debt Cycle

Thinking back on life growing up, I realized I didn’t always approach money in the correct way. I thought I knew everything I was supposed to know about money. I figured, if there was

anything more important to know, I would have learned it in school, right? There was a love

hate relationship with money. I loved to spend it and hated not having it. I wasn’t equipped

with the necessary skills to budget and manage finances. I felt ashamed and embarrassed. I

couldn’t reach out for help or talk to anyone. I couldn’t let on that as an adult, I didn’t know

how to manage life or debt. I was spiraling out of control. I began to pay attention to those

around me and realized, I wasn’t alone. I wasn’t the only one feeling lost when it comes to

money and finances.

So many of us wonder why we don’t have money, where it all goes each month and why can’t

we keep it? It starts with us recognizing where we are right now, paying attention to our

mental money mindset and establishing a monthly spending plan.

Where do you begin?

What are your thoughts when you think about budgeting? What do you feel internally when

you think about the bills coming due and you know you need to sit down and pay them?

The average person tends to have negative thoughts or emotions when it comes to budgeting, finances and paying bills. It doesn’t matter what age you are; money problems happen. Unexpected bills and debt can pop up out of nowhere and threaten our financial peace.

With our daily life stressors, we continue to manage our finances the best we can, usually

looking for a quick fix to end our credit woes and issues. We think we fix it, then the bad habits start all over again. We find ourselves back in the place we started, sometimes worse off. We feel discouraged and succumb to the thought, there is no way out. It’s a vicious cycle we just can’t get out of.

Quick fixes aren’t always the best solutions. As in the words of that famous age-old adage, “If it sounds too good to be true, it usually is”. Having and maintaining a balanced budget and

getting out of debt, is not a quick fix. It took you time to get into debt, so you will need lots of patience to get out from under it.

Changing your financial outlook must first start with a shift in your mental mindset. Your

dreams of financial freedom cannot be reached if you feel doomed from the start. Trying to

keep track of income, expense and due dates in your head can often lead to trouble as well. So, you need to develop a plan of action. Your budget or spending plan will be unique to you and your individual situation. But it starts with identifying how you see money. This process takes discipline and dedication. Any negative self-talk can hinder your progress. Do you use any negative self-talk when it comes to your finances or money. Ask yourself these questions:

- Does talking about money make me uncomfortable?

- Do I find myself being down because I don’t have money?

- Am I sabotaging my own budget?

It does take a lot of effort to consciously admit we are the ones damaging our finances. Once you recognize and admit you can do better, you begin to pay attention to your own actions. You can track your spending using a few of the ways included.

You can begin to shift your mental money mindset towards positively achieving your financial

goals. The key to developing a practical spending plan is to have clearly defined goals. These goals help prevent you from making foolish choices. We tend to overspend, overdraft and pay extra in interest and fees when we don’t keep our goals in mind.

Think about all the money you’ve ever wasted. Most of us have a living room full of barely

touched knick-knacks. You can probably relate to those small appliances and gadgets in your

kitchen that go unused after the initial seal is broken. How much of this would you return just

to have the money again? Thinking about all the money wasted in the past, helps us clearly

define our goals. This invokes a newfound discipline to distinguish between wants and actual

needs. Initiating small mindset changes can position us to begin to reach our financial goals.

Our financial goals should be attainable and based on our own circumstances and situation.

They do not need to be complex but should be specific to ensure you can accomplish it. We can start by setting three financial goals. The first goal is considered short term. This should be something you can accomplish within the next 12 months. The second goal should be

something you can accomplish within the next 24 months. The last goal should be a long-term goal or something you can accomplish within the next five years. Not all financial goals have a monetary value. But remember, your goals are unique to you, designed by you and you alone, will accomplish them.

Allowing yourself to think differently about money and adjust your mindset will allow you to

break the vicious cycle of debt. Instead of stressing about your current debt load make small

steps to identify where you are financially. Then work to identify how you can adjust your

mindset and lifestyle to accomplish your goals.