by Rick Kahler
Congratulations! You’ve made the courageous decision to commit to financial sobriety. You’ve committed yourself to creating a spending plan, paying off your debt, creating an emergency fund, and fully funding your financial independence.
This probably means you’ve made a conscious choice to downsize your lifestyle. You may be driving a cheaper car, eating out less, shopping less, and traveling less. You may have moved to a smaller house or even a more affordable city. You may have gone back to school to improve your future income.
Whatever you’ve done, it took a lot of courage, focus, and hard work to put yourself on the road to financial sobriety. Here are some reminders to help you stay on that road:
- This lifestyle downgrade isn’t forever, especially if you are paying off debt. Someday the debt will be paid. You'll have the joy of using some of those funds to expand your lifestyle and investing some in your financial independence, paying toward the future instead of the past.
- Relapse is certain and necessary. No one follows a spending plan to perfection, especially in the first few months. Remember, your plan is an estimate of the future and a work in progress. You don’t need to get everything right or do it perfectly. You will certainly miss an expense here and there, underestimate, and overestimate. You will probably need to refigure and readjust for the first year before you really hit your stride.
- Difficult emotions are to be expected. You may feel a host of emotions like fear, sadness, embarrassment, shame. You may have times of feeling hopeless and overwhelmed. Honor your emotions—they are real—but let go of the negative self-talk that often accompanies them. The land of financial sobriety is unfamiliar territory. It’s going to take you awhile to become accustomed to this new way of being. Don’t berate or "should" on yourself. Let your dreams become bigger than your fear.
- Keep your eyes on the prize. No matter how poor your past financial decisions have been, tomorrow is a clean slate, a new day. The past does not define your future. Keep your focus on what you want your future to become and what you want to create with your life. Visualize that life of being debt-free and financially independent. Doing so will help reprogram your brain to gain more emotional impact from imagining future gains rather than present fulfillment. You can learn to gain more pleasure from paying an extra $100 on an outstanding loan and imagining a life free of debt than from buying a new pair of shoes.
- Progress comes in small steps. Remind yourself you are not where you were. Progress can seem painfully slow in the early days of reducing debt, building an emergency fund, or growing your 401(k). In my 20's, I started an IRA with $50 a month. I remember looking at a statement that represented two years of investing and thinking I would never get anywhere at that rate. As the years went by, I was able to save more and more. It wasn’t until my 50’s that the compounding growth of my meager initial savings started snowballing. By then I had a sum that could support me with a modest lifestyle if I chose to quit working.
This journey of financial sobriety is not easy. Like most things of value in life, it takes determination and persistence. Set your sights on creating a life worth living, then align your financial behaviors to support that vision. You'll achieve success, and you'll also enjoy the journey.
Rick Kahler, Certified Financial Planner®, MS, ChFC, CCIM, founded Kahler Financial Group, and became South Dakota’s first fee-only financial planner in 1983. In 2009, Wealth Manager named Kahler Financial Group as the largest financial planning firm in a seven-state area. A pioneer in the evolution of integrating financial psychology with traditional financial planning profession, Rick is co-founder and co-facilitator of the five-day intensive Healing Money Issues Workshop offered by Onsite Workshops of Nashville, Tennessee. He is one of only a handful of planners nationwide who partner with professional coaches and financial therapists to deliver financial coaching and therapy to his clients. Visit KahlerFinancial.com today!