39
Chapter 2: Improving Your Relationship with Money
Book I
Taking
Charge
of Your
Finances
health therapy, or if you don't have insurance, find out about
low-cost/no-cost mental health resources in your area. A good place
to start is the Web site of the National Mental Health Association,
www·nmha·org
.
Other books about money and your relationship with it: Reading
books like Your Money or Your Life: Transforming Your Relationship with
Money and Achieving Financial Independence by Joe Dominguez and
Vicki Robin (Penguin Books) and Mary Hunt's Debt-Proof Living: The
Complete Guide to Living Financially Free by Mary Hunt (Broadman &
Holman Publishers) can help you rethink your attitude toward spending
and debt. They can also help you live a life that is simpler, more person-
ally rewarding, and less focused on spending.
Your friends and family: Don't let pride and embarrassment keep you
from letting the people closest to you know that you're having financial
trouble. You'll isolate yourself when you are most in need of their moral
support and encouragement.
Digging Out of Debt
Excessive consumer debt can be a prison, holding you captive to past finan-
cial decisions and overspending. You need to pay off your debts to free up
money for your current lifestyle and future plans and dreams. In addition to
living an all-around frugal lifestyle, the following steps help you get debt free.
Step 1: Acknowledge the problem
The most important step is acknowledging the problem and realizing you
need to actively do something about it. Make paying off your debt a high
priority or you may face a major debt-related problem such as utility shut-off
notices or even a personal bankruptcy. If any of the following statements are
true, you have a consumer debt problem:
You have little or no savings and are at your limit on most credit cards.
You juggle bills each month, deciding which ones to pay and which need
to wait until the next payday, even if it means paying after the bill's due
date and incurring subsequent late fees.
You've taken at least one cash advance from a credit card account or
other line of credit to make payments on other debts.
Your debt load (including car payments but not including mortgage)
exceeds 20 percent of your income. Most budgets can reasonably handle
a 1015 percent debt load, but more than that is excessive.
