At some point in your life, you may experience a time when you feel like you just can’t get ahead. No matter what you do, there’s another surprise waiting for you – and not the fun kind.
Your car breaks down. You missed a payment. You're laid off. You receive a huge tax bill. You get evicted. Sometimes, “when it rains, it pours.”
When I was 22, I got laid off from my job, was dumped by my boyfriend, got into a car accident, and had my grandma pass away – all within a matter of months. To make matters worse, I got sick dealing with all of the stress from this series of events. For that entire year, life was about surviving from one day to the next.
Four years ago, I found myself on food stamps and depleting the savings I had worked so hard to build so that I could survive and continue to pay my student loans.
Just this year – after paying off all my debt – I got hit with a huge tax bill that completely wiped out my emergency fund. All of these unexpected surprises can wreak havoc on your personal finances.
Even with an emergency fund and solid savings, major life events can clean you out and bring you back to square one. It’s easy, at such times, to feel defeated and get down about your finances.
But feeling down and staying there can prevent you from moving forward and making progress.
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Don’t Dwell on the Mistakes
Sometimes unexpected things happen that you have no control over. Other times, you do something (or don’t do something), and there’s a ripple effect that causes a setback.
When this happens, it’s easy to brood over your situation and get stuck in a negative feedback loop.
Why did I do that?
I’m so stupid!
If only I did X …
It’s easy to dwell on your mistakes – and in a weird, masochistic way, it can feel like the right thing to do. But according to research done by the Journal of Consumer Psychology, dwelling on your mistakes makes you even more likely to repeat them.
So instead of going over how you messed up, again and again, acknowledge that it happened. Ask yourself what could have been done differently, if anything. Strive to move on.
Remember That It’s Possible to Rebuild
During the tough periods in my life, it always felt like I was going to be stuck there, as though things would never get better. But after the first particularly tough time at 22, things eventually did get better.
When things were bad again at 27, I knew better than to just think that my life was going to always be this bad. But even then, I felt mentally stuck. I was worried I’d never be able to rebuild my life.
But now that I'm out of those phases, I've seen that it is, in fact, possible to rebuild.
Humans are resilient creatures. We deal with so much stuff in life, and it’s not easy. Even though some dark periods can take over years of your life, it’s always possible to rebuild.
It may be slow and painful, but it is possible. Remember the good times in your life. Though those good times may be a distant memory at the moment, bad times don’t stick around forever. Life is full of ebbs and flows, and sometimes you just have to ride out the tide.
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Focus on Gratitude
When you’re feeling down about your finances, you can easily spiral into depression and anxiety. To help combat those emotions, focus on gratitude.
It can be tough to look at the bright side when everything looks so bleak, but start small. Write down three things you are happy for each day. It could be your health, a roof over your head, and a hot cup of coffee.
Gratitude can be powerful because it allows you to focus on the things you do have, rather than the things that you don’t. While this won’t magically make everything better, this is a quick boost to help you mentally adjust your mood.
Empower Yourself
First, look at the root of the problem. Is your financial situation bad because of overspending? Lack of income? Cost of living? Medical debt? There are a number of reasons why your financial situation might be in disarray.
Once you’ve determined the root of your problem, focus on the things you can control.
For example, if overspending is an issue, put away your credit cards and adopt a cash diet. If your income is the issue, work to negotiate a higher salary or get a side hustle.
Additionally, empower yourself by learning the basics of personal finance – everything from how interest works to the intricacies of credit scores, investing, and more. Having an understanding of personal finance may help you make better decisions.
Bottom Line
Everyone will face a serious financial pitfall at some point or another. Like most things in life, it’s not what happens to you, but how you react to it that matters most.
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