How to Bounce Back From Financial Mistakes
We’re not perfect. We’re all guilty of one financial mistake or two, whether it happened yesterday or years ago. How do you shake off these money blunders and bounce back? With some honesty, reflection, preparation and a touch of class.
I made my fair share of mistakes in life, and although financially conscious, I had missteps on the money front, too. I still remember those feelings of anxiety and disappointment when I realized I messed up.
Dwelling on past failure doesn’t help you. Follow these steps I learned from my experience to come out from a bad financial error:
1. Acknowledge the problem. The first step to solving any problem is admitting you have one, right? Call out the issue at hand and label it for what it is. Is it a loan that you cannot pay off? Is it a shopping addiction? Maxed-out credit cards?
Admitting money problems is hard to do. It is more difficult when you don’t really pay attention to your finances – which is a problem in itself.
2. Answer some questions. If you’re in an unfortunate financial situation, chances are you got yourself there. This is not the time to play the blame game. What you need to do is taking the time to reflect on what false steps you took. What could you have done differently and what are you willing to do to prevent it in the future? What are some bad habits you need to break?
Dig into those fuzzy feelings you have about money. What beliefs do you have about money? Do you take an active role in your money? Do you deserve to be financially stable?
3. Clean the slate. If you owe somebody an explanation, reach out. Inform your friends, family, utility company, bank or whomever else about the issue you face, and let them know you’re ready to work toward a solution. Be open and honest with them. You’ll likely receive a much better response than if you ignore the problem.
4. Start walking the walk. Do what needs to be done to get back. Get a grip by setting up a debt pay-down schedule, tracking your expenses, creating a monthly savings goal and automating contributions. Have an accountability partner, a friend or spouse, to keep you on track. If you find that you’re not able handle your issue by yourself, seek help from people with the expertise you need.
Mistakes happen. Instead of beating yourself up, it’s time to set the wheels in motion for a fresh start.
Follow AdviceIQ on Twitter at @adviceiq.
Mary Beth Storjohann, CFP, is the founder of Workable Wealth, an RIA in San Diego. She is a writer, speaker and financial coach who is passionate about working with individuals and couples in their 20s and 30s to help them organize and gain confidence in their financial lives. She has been quoted or featured in various industry publications on the local and national level. You can find her on Twitter at @marybstorj.
AdviceIQ delivers quality personal finance articles by both financial advisors and AdviceIQ editors. It ranks advisors in your area by specialty, including small businesses, doctors and clients of modest means, for example. Those with the biggest number of clients in a given specialty rank the highest. AdviceIQ also vets ranked advisors so only those with pristine regulatory histories can participate. AdviceIQ was launched Jan. 9, 2012, by veteran Wall Street executives, editors and technologists. Right now, investors may see many advisor rankings, although in some areas only a few are ranked. Check back often as thousands of advisors are undergoing AdviceIQ screening. New advisors appear in rankings daily.