Dealing With Your
Financial Reality

In today’s economy, millions of people are struggling to adjust to a shift in their financial lifestyle. Often the problem goes much deeper than developing a budget and spending sensibly. There is a great deal of emotional and psychological baggage that needs to be worked through before the practical work can take place and a sustainable plan can be put into action. When we allow our financial struggles and related behaviors to keep us in denial, we create more lies that cover the truth of our reality.

Woman upset with home finances

The LIES that Limit™ people who are going through financial crisis have a snowball effect. The longer people continue to ignore the reasons they spend beyond their means or ignore their bills, the longer they'll do it. The secret to putting one's financial house in order is unmasking the fear of failure and taking back control from the labels, illusions and presumed stigma that comes with admitting there's a problem.

Here are four powerful financial lies that can negatively impact your long-term happiness:

Lie #1

"If I admit that I've failed financially, then I'm a complete failure."

  • No one is a complete failure. This is an exaggerated statement that just reflects the fact that you feel really bad, embarrassed and ashamed about the predicament you're in.
  • You've let yourself down in one area of your life. Turn this slip-up into a step up. Create a plan to fix the problem and learn from what you did or didn't do that put you in this place. Take the lessons and apply them going forward.
  • Don't kid yourself or wallow in self-pity. We all fall short of our goals and intentions from time to time. Face your facts, pick yourself up and get on with fixing the problem.

Lie #2

"I don't know any other way to live – I can't possibly change my spending habits now."

  • "I can't" is the same as saying "I won't." It is a statement of strong resistance and inflexibility. If you're willing to test these false limits – the "I can't possibly change" limits – then you have a chance to uncover some options.
  • Look around at other people who seem to live well, whom you assume to have similar means. Ask them how they manage their lifestyle. Try on a few different things they suggest and see how they work. The ideas may not feel like a custom-fit right away, but you'll adjust if you stick with it. That's the remarkable thing about human beings: We are capable and flexible.

Lie #3

"Getting new things is the only thing that makes me feel good."

  • If you have an insatiable need for the new, then you're missing something really important. You're trapped by an illusion and trying to fill a bottomless hole with stuff. Ask yourself, "What am I really craving but covering up with buying and spending?"
  • You're actually working with an addiction whose emotional pull is strong. To overcome it, you'll have to be strong. Replacing a habit that's no longer helpful with one that is functional is one way to address addiction. Work at disconnecting from the old behavior and trying out the new, healthier option.
  • The next time you want to buy something new, don't. Instead of spending time shopping, spend time with yourself. Sit with your journal and write down all the reasons you want that new thing. Note whatever comes to mind, no matter how ridiculous or embarrassing. It's natural to bump into your "craziness" when you take action to get to the root of your issues.
  • Be constructive. Go for a walk or put on your favorite exercise DVD, or dance to music that helps you get your groove on. Give yourself a constructive activity to replace the one you can no longer afford.

Lie #4

"My family will suffer if anyone finds out we're no longer able to live extravagantly."

  • What you're struggling with is your image of yourself. Your ego has you trapped. You're using an untested excuse to generate mental and emotional suffering, and paralysis. Stop repeating this message about how awful it's going to be.
  • Shift your perspective on your circumstances and pave your way to a more positive experience. Something good can come out of everything – even seemingly bad things. Find and focus on the good in this situation.
  • Ask yourself: "What good does this bring to me and my family? Does it allow us to spend more time together, without the distraction of new 'toys' and outside activities? How can this allow us to find pleasure in each other's company – get to know each other better?"

Reframing your thinking is the key to breaking this powerful addiction that can be just as devastating as alcohol or drugs. Reflecting on how you got to this point and making conscious decisions about how you'll spend your time and money will set the lessons you learn in your mind. Once they are set in your mind, the right actions will follow.

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Tags: money mistakes

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Comments

Comments on "4 Lies that hurt your finances"

Shelley August 18, 2012 | 3:56 PM

I believe that saving money is a habit. Once you've built the habit, it becomes easy and something you want to do. My husband and I used to have credit card debt and traveled and shopped all the time. Now, we save first, spend later. Trust me, we both sleep better at night and tackling this problem together has made us closer.

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