You’ve likely heard that every person needs to hit ‘their bottom’ when it comes to tackling denial.
For me, it was $77,000 of debt coupled with the genuine fear of bouncing my next mortgage payment.
It was then that I finally admitted to myself that I needed another source of income.
I was working as a Realtor at the time, which meant I was running my own business, resulting in entirely irregular income with very regular (and costly) business expenses.
I thought long and hard about getting a second job to get my finances on track, but for much too long my ego stood in my way.
Aside from the sheer effort involved, I worried that crossing paths with any of my colleagues would publicly broadcast my inability to succeed as a Realtor. At the time, I felt it meant admitting defeat.
Also, I was still clinging tightly to the notion that perhaps with a little more time I could turn things around - something I believed at $40,000, $50,000 and $60,000 of debt; evidently an ineffective strategy.
But as they say, if nothing changes, then nothing changes.
So, with nowhere to turn, I started brainstorming job opportunities. The criteria for my search included a flexible schedule where I could earn the most amount of money in the least amount of time.
With only two applications, I got a job in a pub as a waitress.
Waitressing was the only work that fit the bill; it was something I’d relied on as I worked through University; it enabled me to work late at night and offered me the opportunity to increase my earnings by working later than others and by taking extra tables.
The truth is that I hated every single minute of working that second job. I resented it mostly because my poor choices lead me there, and it was work I didn’t appreciate.
Oddly enough, with all the resistance in the world by me, the decision to work a second job changed my life forever.
In addition to humility, I learned a few life-changing financial lessons along the way.
1. Ditch Your Ego, and You’ll Change Your Life
Have you ever given thought to how much you care about what others think of you? Have you ever wondered how much your effort to please others shifts the potential in your life?
I hadn’t given it too much thought until I was faced with needing a second source of income. Rather than being primarily motivated by the fear of my impending financial catastrophe, I was motivated first by the judgment of others.
I was petrified to run into my colleagues while working a second job and was even more terrified of the gossip that would follow.
As I got started waitressing, my biggest fears came true time and time again. Industry colleagues would pop into the pub for a bite to eat. I would plaster a smile on my face and try and fake my way through the discomfort of their inquisitive expression and my reluctance to share my reason for being there.
My fears culminated the day I attended a luncheon for our local real estate board. Standing at the podium was a man who chaired a real estate committee I belonged to, in addition to being a regular patron of the pub.
He was one of the few, who knew of my double life.
Faking my way through a professional real estate career by day, and slugging it out in the pub at night.
I believed in its entirety that unlike all of my peers, I just couldn’t hack it as they could. I just wasn’t good enough.
The man began speaking about the real estate industry as a whole, and how it was important to maintain professionalism. And then he referred to his disgust at seeing Realtors working second jobs and how hilarious he thought it was to see them serving burgers on the side.
I was horrified.
I was angry.
Although, only he and I knew - I was the butt of his joke.
With more time though, the headway I was making with my debt repayment was outweighing the shame I felt. Over time I started caring less about what anyone thought, instead focusing on feelings of pride in my work ethic and what I was accomplishing.
The more focused I became about changing my life for the good, the less and less I cared about the judgment of others. I learned that by shedding my ego and doing what is right for me, I could conquer anything.
"The more focused I became about changing my life for the good, the less and less I cared about the judgment of others."
I learned that making financial decisions that are right for me will forever outweigh the judgment of others. I am less interested in impressing others, and more interested in impressing myself.
When making any future financial decisions, consider how you're being influenced. Are you making decisions best for you, or are you making decisions best for others?
2. Set Crystal Clear Goals to Guide Financial Decision Making
To repay such a huge amount of debt, I set a SMART goal. SMART is an acronym for goals that are specific, measurable, attainable, realistic and timely.
To break down my debt repayment goal, I made a big spreadsheet with my total debt in bold. Then, I worked to determine the minimum amount I would repay each month. By dividing my total debt into monthly payments, I had a clear picture of how long it would take me to repay everything I owed. So long as I met my monthly target, my debt would be paid in a set period - the end was in sight.
My monthly target guided so many of my financial decisions. I opted to work late when the opportunity arose. I took extra shifts. I reduced my expenses. I said no to costly outings. I ate out less. I operated only on a budget. I shelved my social life to keep a complete financial focus on my debt repayment.
With any decision, I asked myself if the outcome would contribute to, or detract from, my overarching financial goals.
So, if there’s debt you need to repay or something you want to save for, set yourself a SMART goal. Break the big goal into manageable chunks, and then when facing a decision, ask yourself whether or not the choice will contribute to the achievement of your goal.
3. Act Like a Lemming; You’re Bound to Walk Off a Cliff
Are you familiar with lemmings?
If not, lemmings are small rodents found near the Arctic and were also depicted in a 1958 Disney film called ‘White Wilderness.’ The film shows lemmings, moving single-file, as one by one they walk off a cliff.
While it seems this lemming behavior was fictionalized, the thought of lemmings blindly following a crowd - even into catastrophe, is a good reminder of human behavior.
There are many way financial decisions resemble the behavior of lemmings.
Have debt? It’s not that bad, right? So, does everyone else.
Have little savings? No big deal. Neither does anyone else.
Your car’s a little old - you should probably get a new one - just like everyone else.
Lemming mentality is to normalize debt and minimize the importance of savings. Lemming mentality is ‘keeping up with the Jones’. Lemming mentality is making decisions based on the judgment of others rather than what works best for you.
When making financial decisions, don’t look to others around you to determine the right course of action.
Make decisions that are right for you and your circumstances by doing anything to minimize debt and maximize your savings.
4. If You’re Looking for Pride, Leap Outside Your Comfort Zone
Just for a minute, picture a circle, then picture a small dot inside of the circle. The dot represents you standing inside your comfort zone. Generally speaking, existing in one’s comfort zone is stress-free and, as the name implies, comfortable.
Sounds pretty good, right?
But when thinking of the accomplishments in your life that you feel most proud of, did they occur while you existed in your comfort zone or did you have to step outside of it?
When I reflect on what I’m most proud of, the things I feel most proud of occurred well beyond the limits of my comfort zone. In fact, I’d venture to suggest that the level of pride is positively correlated to the distance from my comfort zone. Big leap = big pride.
So, rather than representing the dot inside the circle, move the dot beyond the bubble of comfort as this is ‘where the magic happens.’
If you’re looking to accomplish anything (financial or otherwise), you need to push beyond what feels comfortable.
For your finances, this might mean digging deep to find methods of earning extra money, setting an aggressive goal for savings, setting your sights on an incredible vacation
The Bottom Line
If anyone asked me what kind of life I want, I certainly wouldn’t say average. I don’t want a life dictated by social norms and blind faith. I want an intentional life filled with accomplishment, pride, and adventure.
The perfect formula for an average life is to do what average people do. But, if you’re looking for something different, like me, you’ll have to push your limits.
To maximize your potential (financial or otherwise):
Drop your ego. Set Crystal Clear Goals. Never Be A Lemming. And, Leap Beyond Your Comfort Zone.