Hitting the reset button- on life and debt

This fall our family tackled a project I dubbed “let’s pretend we’re moving.” We did a whole house cleanup, and got rid of a huge amount of stuff that was weighing us down. We’ve had several years of health issues in our family, and when those types of things come along, it can put you in crisis mode, with your focus on the immediate and urgent and pushing tasks like organizing and cleaning out on the back burner. In our case, thankfully things have improved and life is back to normal. While we are keeping current on managing things, what remained was the piled up remnant of that dump-and-run-I’ll-get-to-it-later time, mostly centered in our basement. That clutter was draining, and the thought of “ugh, the basement” was noise in the back of my head. We were no longer in crisis mode, but it was still difficult to feel renewed. We needed a reset, a fresh start.

Debris from a crisis can pile up financially as well. An illness, a job loss, or just a string of bad luck can run up debt in a hurry. Time and time again I’ve seen folks recover and get back on track financially, but still feel like they’re dragging around a bag of rocks because of leftover debt. Getting rid of those rocks isn’t just freeing financially, but emotionally as well.

Acknowledge the problem
When your mess is hidden behind closed doors-or in unopened envelopes- it’s easy to ignore. But it doesn’t go away by itself, it simply grows more unmanageable. You can only look the other way for so long before you are faced with an AHA or an OH NO moment.

My moment came at about 2 am. We were having some work done in our basement the next morning and needed to clear away a space. After a couple hours of struggling with the pile of stuff, I had had it. We knew the basement was out of control and had attempted to tackle it a few times before, but this time I was fed up. Never again did I want to simply rearrange the mess, I wanted it gone. I was DONE.

Your moment might be running up against minimum payments you can’t handle anymore, or realizing the credit card interest you’re paying is choking you. Whatever your moment is, you’ll know it when you feel it.

Understand the why
Before you hit the reset button, you need to understand how you got to your current position. Where did your debt come from? Was it from 20141012_142256 challenging circumstances like a job loss or medical condition and unlikely to happen again? Or is it a symptom of chronic overspending? It doesn’t do you any good to bail out the boat if there is a leak in the bottom. If your debt is a result of overspending, you’ll need to get that under control or be back in the same predicament in no time.

Just do it
If you had told me project pretend move would take part of every weekend for three months, there’s no way I would have started. It would have seemed overwhelming. But what began as cleaning out a small corner of the basement expanded into a whole house expedition, cleaning out every single closet, drawer, pile, and box in our home. Same goes for paying off debt. Thinking about how long it will take can be deflating. You need a long term view but a short term focus. Start by concentrating your efforts on your smallest balance and then move on to the next when it’s paid off. The satisfaction of completing one task in a shorter period can keep you going more than spreading your efforts across several accounts.

All aboard
My family didn’t quite share my passion- okay, okay, obsession- but they did share the desire and effort to get the job done. If they hadn’t, my work would have taken longer and might even have been sabotaged. Certainly I wouldn’t have had the energy to persevere to the end. When you embark on a debt payoff plan, family support is crucial. Who wants to be the bad guy saying no to something in the interest of being fiscally responsible when the rest of the family is resentful? One family member may take the lead and be most passionate, but the vision must be sold to the others as well to be most successful.

Get the right tools and the right help
20141012_142821In order to do the job efficiently, we purchased shelving units and bins, and a big box of trash bags. The last thing we wanted to do was make more piles- for cleanup day, to donate when we got to it, and so forth. We scheduled a pickup from the Salvation Army online and rented a dumpster so it would all go while we were still in the zone. When we wanted to move furniture from room to room, we called on our friend’s sons to do the heavy lifting. When it comes to paying off debt, tools can help too. Use Mint.com to set goals for yourself, track your progress on spreadsheets or even a chart on the fridge. Watch the improvement in your credit with a free credit report card from Credit.com. Should the need arise for professional help getting on a plan or negotiating with credit card companies, enlist the services of Consumer Credit Counseling.

Be resolute
Or even ruthless at times. I kept the rule in mind, if you wouldn’t buy it today don’t keep it. I wasn’t able to go quite that far, but we parted with far more than was comfortable at times, knowing the goal was a simplified environment. Do the same with your debts. Do what it takes, even if it’s uncomfortable. Maybe that means giving up something you wouldn’t ordinarily want to do without- an expense to take a break from, selling possessions, working extra hours. Focus on how good it will feel when you get to the other side.

Celebrate victories
Your long term plan may take quite a long time. Don’t wait until the end to enjoy your success. Encourage one another by celebrating milestones like getting your first card paid off. If you’ve given up cable to do it, perhaps a trip to the movies (matinee of course) can be a reward and a boost to keep going. We periodically stood and stared at the organized shelves or open space, and that was reward enough!

buh bye

buh bye

Maintain vigilance
I recognize my tendency is to pile and to hang on to things, so I know I must be diligent to keep up and not let things get to a point where it’s overwhelming. That means taking the time regularly to prune and have tools in place to stay organized. Who would have thought a spice rack for a drawer or a new cutlery organizer could be inspiring? For whatever reason, little things like that help me. Credit card spending can easily get out of control too if we don’t watch. Life gets busy, and you don’t get to pay the whole balance one month so you let it slide, it happens again, and pretty soon you’re on a slippery slope to overwhelming debt. Do whatever it takes to stay on top of it, whether that means paying cash for everything, or charging and paying off the balance weekly. Remember the good feeling of being debt free and enjoy your clutter free finances.

I probably got a little too excited about our new organizing tools.  Not to mention spending an unacceptable amount of time on Pinterest searching ways to organize just about everything.  But if things like spice drawer racks and shelving units energize you too, check out this post on the things we used (IKEA’s plastic bag holder is genius).

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