Here are the most common things keeping you from fixing your finances and what you can do about it.
1. You Don’t Know You Have a Problem
The first thing that might be keeping you from fixing your finances is that you don’t know you have a problem.
If you don’t know you have a problem or don’t know what your problem is, it will be impossible to make any meaningful changes.
Or it could be that you’re unwilling to acknowledge that you have money problems.
Either way, acknowledging you have a problem and pinpointing exactly what that problem is will allow you to come up with a plan to work toward improvement.
What You Can Do About It
Acknowledge that there is a problem and figure out exactly what that problem is. For example, do you spend too much money? Are you not saving enough? Do you have a lot of debt?
Once you identify the problem, come up with a plan to work toward a better situation. You can reach out to family, friends or finance professionals for help. You can even find help for free. Personal finance blogs, nonprofits and even many banks and credit unions offer financial coaching and help at little or no cost to you.
2. You Don’t Know Where to Start
Another reason you may have neglected fixing your finances is that you simply don’t know where to start. This is a common issue that happens when an individual is so overwhelmed that they would rather ignore it than taking on the stress of working through the problem. Maybe you have multiple issues with your finances or maybe you don’t have enough financial education to make informed decisions.
What You Can Do About It
It’s OK if you don’t know where to start because there are plenty of options out there to help you. If you’re looking for financial education, we suggest reading up on these topics online or checking out some books on personal finance.
If you need more of a hands-on approach, we suggest consulting with a financial professional. There are plenty of coaches available that can help you get on the right track at no cost to you.
3. You Think It’ll Work Itself Out
Another common reason people don’t fix their finances is they think it will work itself out. They think that as long as they’re bringing home a check and making their payments, any financial problems will eventually resolve themselves.
Unfortunately, that’s not likely to work in the long haul. Sure, making your necessary payments will help you stay afloat, but you’re really not working toward any improvement because you really don’t know where you stand or where you’re going.
What You Can Do About It
Even if you’re staying afloat financially, you’re likely not making any headway. The first thing you need to do is figure out where you stand by building a budget. Figure out how much money is coming in every month, how much is going out, and what your debts are.
Next, decide what your financial goals are. Do you want to become debt-free, save up for a big purchase, save more for retirement (or start saving) or become financially independent? Whatever your goals, knowing your current situation will help you to make a plan for your money so you can start actually moving toward what you want.
4. You Feel Stuck
Maybe you know you have a problem with money, maybe you know exactly what that problem is, and you know what would solve it. Even so, what may be keeping you from fixing your finances is that you feel stuck.
What You Can Do About It
It’s tough when you know there’s a problem but you don’t see a way out. You may feel hopeless about your situation and like there’s no point in trying to make changes. No matter how deep the hole, there are always things you can do to try and make your situation better.
Consulting with a financial professional or seeking advice from family and friends can help you discover new and better options. If you’re working but still struggling to pay bills, perhaps it’s time to increase your knowledge and skills so you can make more money.
There are nonprofits that help people find resources such as jobs, affordable housing, educational opportunities and assistance, and more. Check your local library or social services organization to see what options are available where you live. Even though it may be a long road, you can always strive to make things better for yourself and your family.
5. You’re Banking on Money
While many may be hindered from fixing their finances because they feel stuck, others may feel free to let their finances run amuck because they’re banking on getting a chunk of money at some point. This scenario may be most common with those expecting an inheritance. They feel safe living beyond their means and accruing debt because they think they’ll be bailed out with a big chunk of money.
Another scenario is playing the lottery or gambling. Humans naturally tend to gravitate toward the easy route, or at least what is perceived as easy. Winning the lottery or a big jackpot is much easier than the hard work and discipline it takes to fix your finances. For others, winning the lottery or a jackpot may be the only way they could ever see themselves having access to money.
What You Can Do About It
Whether you’re banking on an inheritance or the lottery, if you don’t know how to manage your finances before you have money, chances are you won’t manage it effectively when you do have it. One study found that a third of those who inherit money blow it, and 44% of lottery winners go broke within five years. Plus, the probability of even winning the lottery is one in many millions, with gambling odds not much better.
The lesson? Don’t bank on winning money to solve your financial problems. And even if you can expect to inherit money, realize that the money behaviors you’re developing now will dictate how you handle that money. If you don’t want to lose it, start fixing your finances now.
6. You Have Regrets
On the other hand, maybe what’s keeping you from fixing your finances is that you’ve made mistakes with your money in the past and you have regrets. The thing is, we all have regrets. No one is perfect and looking back we all have things we wish we would have done differently.
Maybe you wish you didn’t have that huge payment every month and regret buying that new car, or maybe you wish you’d started saving sooner. Maybe you wish you’d taken a risk on a business idea. Another way regret could be holding you back is when you avoid making changes because doing so would mean admitting you’ve made mistakes and you want to avoid regret.
What You Can Do About It
Regret about decisions you wish you’d made (or didn’t make) can’t continue to dictate your money life. Realize that the past is over and the future hasn’t happened yet. You can’t change the past; all you can do is start today and begin doing the best you can.
The same thing applies if you’re avoiding making changes because you’ll then regret those choices … except, in this case, putting your head in the sand is likely making the problem worse instead of putting yourself on a path to do better. Again, the decision was already made, and you can’t change that. All you can do is begin making new decisions that will give you better results.
7. You’re Embarrassed
One major thing keeping many from fixing their finances is the fact that they’re embarrassed You’ve made money mistakes and probably don’t want anyone to know about them. You don’t want others to think you’re dumb or to laugh at you. You may think others are judging you.
These feelings of embarrassment and shame can be paralyzing and may lead you to do nothing or to avoid discussing your problems and seeking help.
What You Can Do About It
The first thing you need to understand if you have money problems is that you’re not alone. Chances are, even though you may not be able to tell from the outside looking in, most of those around you are struggling with money in some capacity as well.
You don’t have to let on to your family and friends that you’re struggling if you don’t feel comfortable, but you should seek out help. If you have someone you trust, confide in them and see if they can point you in the right direction. If not, seek out an organization or other entity that can help provide some guidance. You may have services you can access through your job, school, or city. We’ve already mentioned nonprofits as a potential resource, as well as online resources such as blogs.
These services work with people struggling every day and are non-judgmental. Plus, no one you know needs to find out.
8. You’re Afraid
The last thing that may be keeping you from fixing your finances is that you’re afraid. Maybe you’re afraid to confront the situation. Maybe you’re afraid of how others will see you. Maybe you’re afraid you’ll make the wrong decision, so instead, you do nothing. Change is hard, and humans tend to want to stay with what is familiar to them even if they know it isn’t working.
What You Can Do About It
The greatest mitigator of fear is education and experience. Chances are that you’re afraid to make changes because you don’t feel confident in doing so. We’ve already mentioned a plethora of potential resources that will allow you to better understand finances and gain confidence in managing your money.
If you’re afraid to confront your financial situation, understand that you can’t change what you don’t acknowledge and that things will never change unless you initiate it. We live in an unprecedented time of readily available resources. You can learn almost anything through reading books, articles, and watching videos online.
We also live in a time where social services are accessible to almost anyone who goes looking for them. Change is hard and finances are scary, but with time and effort, you can learn to manage your finances and begin working toward your money goals.
By Twayna Redding
