Getting sober required you to assess and repair many different aspects of your life and getting your bank account in order is no different. While addicted, it is not uncommon for your hard-earned cash to disappear more rapidly than they were earned, so it’s no surprise that many recently sober or recovering individuals suffer from residual financial strains. Rather than ignore these issues, you can use the following tips to guide you on the road to financial stability.
Tip #1: Take an honest look at where you are
While it may be easier to live in denial, at this point in your recovery process you know that recovery isn’t about taking the easiest path. It’s time to face the facts and accept your situation. You cannot change the past so focus on moving forward. The first step in moving forward is to take an honest and careful inventory of your financial situation. This will help you establish and prioritize the problems you face, the resources you have, and the solutions you will need.
Tip #2: Create a realistic goal
After facing reality and taking inventory, you are ready to move on to goal setting. Starting small, set yourself one obtainable goal. This goal can be anything from getting $2000 dollars in your savings account to recording all your purchases. Pick a deadline for your goal and write out the actual steps you will take to achieve it. Remember to hold yourself accountable!
Tip #3: Set up a system
Staying on top of your bills, accounts, and debts can be exhausting and time-consuming. Lucky for you, there are smartphone apps that can help you streamline the process. Apps like Mint and Personal Capital link your accounts to track spending, saving, and trends. You can also set up automated bill payments through your bank or other organization to ensure that your bills are paid on time. Once you have a system set up, pick a date and time each week that you can devote to reviewing your financial affairs.
Tip #4: Create a budget
Budget, budget, budget! It’s easy to spend more than you meant to if you aren’t tracking where and how your money is spent. A budget is, most simply, a tool to help you track and plan out your spending. To begin building your budget, identify your necessary expenses (things like rent, utilities, food, and car payments). These essentials should make up about half of your spending. Once you have your essentials budgeted for, you should try to save about 10 to 20% of the left-over money. The remaining money is your living money. To go a step further, you may want to average out the costs of things you commonly spend on like restaurants or coffee, to ensure you don’t overspend.
Tip #5: Live below your means
This is the second most common financial advice you are likely to receive, but it is also one of the hardest to follow. Our current society is very materialistic and as such we are constantly bombarded with the idea that we ‘should’ be buying certain things to fit the trendy lifestyle. It’s easy to spend money on nonessentials; however, living below your means is the key to long-term financial well-being. Living below your means simply means that you spend less than you make. Working with your budgeted spending amount, you can ensure you do not overspend.
Tip#6: Plan for your future
Now that you are actively recovering, you do not need to live in a survival state. You are now able to look towards the future. An important part of that future is making sure you will be financially prepared. To plan for that future, remember to save and invest some of your money so that you won’t have to worry about small emergencies derailing your long-term financial well-being.
Tip #7: Stick with it
In an ideal world, you would never overspend, there would be no unexpected expenses, and you’d always have a steady income, but we don’t live in an ideal world. That being said, it’s important to remember that even when things come up or you accidentally overspend, it’s okay. Try not to get too discouraged. Stick with your plan and don’t worry if things don’t always go as planned. Just do your best and eventually, you will succeed.