Steps to Financial Stability

When we have financial stability it contributes to feeling peace in other areas of our life. Financial stability means more money coming in than going out; being able to save money and have little or no debt.

Sometimes it is scary to check the bank account and even scarier to add up the bills. But springtime is for new beginnings so why not start fresh and work your way up to financial stability? Remember that it takes longer to pay a debt than it did to accumulate one, which is why the following steps will require time and patience. A good way to start on the road to financial stability is to accept that addictions such as spending, gambling, and materialism, can cause financial instability. It is recommended that in addition to following the 10 steps in this series, also seek counseling with us or another counseling service near you if you struggle with addiction and/or financial problems.   Our Financial Recovery Coach, Mae Bell Pendleton, is nothing short of wonderful.


Step 1.  Facing Reality

Make a list of all your bills including rent/mortgage, food, utilities, transportation, phone, internet, loans, credit cards, and any other expenses you may have. Write down your net (take home) income and any other income such as child support, social security, disability, and pension.

Just doing this step is very powerful and sometimes extremely scary and stressful.  It gives you a picture of your current financial well-being.  Don’t get depressed if you don’t like what you see.  Remember, it’s springtime, a fresh start.

Kudos to you for taking the first step! J


Step 2.  Prioritize

Prioritize all the bills gathered in Step 1.  First priority should be the bills that keep you and your family safe and secure. Start by analyzing the bills that embrace basic daily needs such as home, transportation expenses, employment, and food.  Secondly, review any other bill that can wait until you know that you are able to handle the necessary basic bills.  Subtract the bills from your monthly income. The balance (If there is one) is extra cash.

After you have completed this step you have a basic budget.   With this budget you will be able maintain a picture of your financial situation, monitor progress, set limits, goals, and track your progress, to get out of debt, save for something,  and afford new things. Remember a budget does not mean doing things cheap; it is about you being smart by pre-planning.

Kudos to you for taking the next step! J


 Step 3.  Paying off Debts

Debt does not go away overnight.  Remember, you didn’t get in debt overnight either.  Big bills always grab our attention first.  However, small debts should be paid first. Among your second priority bills and debts, pick the smallest. Don’t feel like you have to pay the entire bill right away, just add a reasonable payment to your monthly budget until it is paid off. Don’t spend every penny…..keep some extra cash for emergencies.  When you have paid off the smallest debt, find the next smallest debt and continue to the next and the next as each debt is paid in full.  As you pay off each debt you then have the monies you were paying on the previous debt to help pay the current debt sooner.  The more debt you pay off the more money you have to eventually pay off that really big debt.   The progress you make while paying off debt will feel so rewarding.

Kudos to you for taking the next step! J


 Step  4.  Receipts, Receipts, Receipts

It is important to keep receipts, if it all possible you should create a computer spreadsheet where you can enter all the receipts. Keep an envelope in your vehicle or in your purse (if you carry a purse that is) to collect receipts in.  Be sure to include the most insignificant and smallest receipts because that is also part of your expenses.  Keeping receipts and logging them into your spreadsheet helps you to track spending. Keeping and reviewing receipts on a regular basis helps you to visualize your spending habits.

Remember to keep following up with step 2 and 3. Kudos to you for taking the next step! J


 Step 5.  Checking/Savings accounts

Open a checking and savings account if you don’t already have one. You can open a savings account with your preferred bank or open a savings account with a bank that does not relate to the bank you have a checking account.  Sometimes the lack of convenience of both checking and savings accounts in the same bank might help with the temptation of spending your savings for the wrong purpose.  At the time of opening a checking and/or savings account, it is suggested that you not request a debit/ATM card which allows you to withdraw money too easily.  Most banks now have a “pay bills online” feature so you can pay bills without the temptation of having dollars in your pocket that might get spent for the wrong thing.  Keep in mind that your savings account is strictly for “emergencies” and nothing else.

Kudos to you for taking the next step! J


 Step 6.  Short Term and Long Term Goals

Setting goals is a very powerful and positive step in your life and finances as you are able to prove how budgeting can assist you in getting things you want and need. If you do not have a short or long term goals, we recommend you to set your goals now before continuing to the next step. A short term goal  is achievable within the time frame you have set to meet this goal such as in less than one year. Long term goals are the goals that you will achieve within a long period of time such as a year or more. When setting short term and long term goals remember to write down the financial cost of your goal and a timeline that will best fit your budget.  This will obviously differ with each person.

Kudos to you for taking the next step! J


 Step 7.  Addicted to…..

If you are struggling with gambling addiction or other addictions go to counseling – it really helps.  Many who come to counseling also attend GA, or AA meetings that can help you become sober and stay sober. Being able to stay sober would be the most powerful and influential step you can take not only for yourself but for your loved ones and also for your financial independence.   Remember, counseling is confidential, often covered by insurance and/or supplemental funding.

Kudos to you for taking the next step! J


 Step 8.  Gaining Control and Responsibility

Stay in control and be responsible for all your finances. Regularly review all your saved receipts, budget spreadsheet, and savings account statements to see how much you have being able to save, and how much you have being able to achieve. This step will help you to stay in control and grow responsible of your finances, and improve your savings techniques.

Kudos to you for taking the next step! J


 Step 9. Progress

Once you are able to achieve your goals, save money and be sober, it is time to “pay it forward”. Encourage others to do what you did to overcome financial duress, addiction and depression and frustration of making the “almighty dollar” spend wisely.  Be proud of what you have accomplished.  Share what you did to become financially responsible.  If you are in GA or AA or another organization such as these, offer to sponsor someone.  Nothing that feels as good as becoming successful in your goals and desires except to see someone else become successful in their battle.

Kudos to you for taking the next step! J


 Step 10.  Building Financial Security

Keeping on track with your budget, not owing money, and being able to save is a good way to build financial security. Becoming wealthy does not mean you are a millionaire. Instead it means having   enough money to retire someday by wise investing and savings.  It means having an “emergency fund” in case of any emergencies and possibly being able to purchase that “special something” that you always wanted to have.

Thank you for learning with us about budgeting, saving money, stay sober, and being financially free. Have a wonderful day.

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