Have you ever thought to yourself ‘I am dead broke’ and knew it was the truth? I’m talking no food in the house, scrounging around for spare change to buy your bus pass, kind of broke.
It happens to lots of people. Hourly workers and those who have dependents are especially vulnerable to hitting a financial rock bottom. If work cuts your hours, or your childcare gets more expensive, you can be stuck without a lot of money, but a whole lot of bills.
It’s a scary and hard way to live, especially when it’s not your fault. You can be eating rice and beans in the dark and still be broke. If you find yourself sad, angry and thinking “I am dead broke, and I need that to change”, we’ve got some help for you.
What NOT to Do
Being broke certainly does limit the number of options you have. Still, there are some choices that will make the situation worse. Here’s what to avoid when your bank account is cruising on empty.
- Avoid payday loans. Payday loans are very tempting when your bank account is at zero, but they are best avoided. Payday loans are short term, high interest loans. And when I say high interest, I mean like 200-400% interest rates. If you take out a payday loan and fail to pay it back in time, you’ll go from broke to high interest debt very quickly. Avoid if you can!
- Ignore bills. Ignoring bills does nothing but cause you bigger problems. if you can’t make a payment, call your provider and see if you can work out an extension, a grace period, or make a smaller payment.
What You SHOULD Do
Here are a few things to do to keep your head afloat and help you climb out of being broke for good.
- Ask for help. If things are truly dire, ask for help where you can. Friends, family, churches, or even the government. Apply for food programs like SNAP to help sustain yourself. See if your local food pantry will give you some food for free, so you can save your grocery money. Ask for what you need.
- Cut back every expense. When you’re broke, there just isn’t the money for any kind of splurge. Yes, it might feel good to spend that extra $50 on a new jacket, but you’re only kicking yourself when you’re down. Tighten the belt as much as you can so that you can build some savings. Being able to save a nest egg is what will break the cycle of being broke.
- Create new income sources. This might be selling items you already own, like video game consoles. Or it might be picking up extra work, like a bartending job at night. It doesn’t have to be glamorous. It just has to help you pay your bills on time and start saving.
- Find a positive mantra. It sounds silly, but stop saying “I am dead broke” to yourself. Instead say “I am creating good financial change in my life.” Repeat it and you’ll make it happen!
Breaking the cycle of being dead broke takes time and continued effort. One week of saving is a good start! But keeping it up for the next 50 weeks is what will create true financial change in your life.
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