When you don’t grow up with money there are a lot of hurdles to overcome when it comes to your money mindset. While many people, especially women, struggle with their mindset around money and their confidence when it comes to their finances, I’ve experienced the challenges that come with overcoming money trauma and debt.
I grew up in a very poor family. I was the first in my family to get a college education and at the time it may have seemed like the choice to study accounting was out of practicality but honestly, it was about survival. I wanted to understand how money worked and take control of my money story. I also wanted to use my knowledge to help my family improve their financial situation and turn over a new leaf. So yes, accounting was a safe choice but it was also a necessary one.
While there were many things I learned in school and working for national corporations and the big names in accounting, nothing has been more important to my money story than shifting my money mindset. They don’t teach you that in school (and they should!)
Your money mindset has to do with how you think about money and what emotions you have in relation to it. Those who grew up with less money than they wanted or needed or even those with a new business can operate from a scarcity mindset. This means that they are so nervous about losing what they do have so they miss out on opportunities to grow it. When we shift our money mindset to one of abundance, not only do we feel more confident around big financial decisions, but we also allow more money into our lives.
It was this shift that allowed me to pay off $100,000 of debt.
Debt can feel like a bad word these days, we are nervous to talk about it and it’s almost like if we don’t talk about it it doesn’t really exist. But, as anyone with debt can attest, it is very much real and can cause a lot of anxiety and frustration. I know because I’ve been there.
Coming from an impoverished family and being the first to receive a college education of course just like many of you I had to take out student loans to pay for not one but two degrees. I didn’t have the luxury of a trust fund or college fund and had to make do with what was available to me. After graduation with a Bachelors in Accounting and a Masters in Taxation, I had all this newfound knowledge on money but was 50k in debt. On top of that just like any 20 something recent grad had racked up 40k in credit card debt and 10k in car debt.
I know how crushing debt can feel, and I know that at times it feels like you might as well stop trying to pay it off because the interest just won’t stop. But I did it and so can you.
The first thing that pushed me to pay off my debt was having a set goal of where I wanted to be in the next few years. I knew I wanted to have the opportunity to buy a house and have all these things that are quite difficult to buy or get approved for a loan when you have a credit score below 500. These factors motivated me to focus my finances on paying off my debt. I lived with a roommate for years after college so rent was cheaper and got a job and worked my 9-5 to figure out how much that would cover making my payments at first. As I learned more about money strategy and figured out how much income revenue I would need in order to eliminate my debt completely I set my mind to do just that. I found new ways to increase my yearly income that wasn’t solely reliant on my career income and began investing and budgeting what money I did have to create more of a steady stream of revenue.
All of this to say, my money mindset shift SAVED me.
If you are faced with a large amount of debt or another financial obstacle, here are a few ways you can take control of your financial journey and shift your money mindset.1. Stop Being Afraid to Spend Money
I know it sounds contradictory but what I mean is being afraid to spend money will put you in a scarcity mindset. Yes, you should pair down your expenses but don’t stop yourself from buying what brings you joy in your life. If you want those Lululemon leggings then get those Lululemon leggings just cut back on another cost in your budget that you don’t need. Not allowing yourself to spend money on things you really want will shift you mentally that you don’t have the money to buy that and keep you there. No, we shouldn’t think like that instead, think of it this way. I really want that name brand item so I’m going to do XYZ to get it or save XYZ amount of money to know that it will fit into my budget.2. Cut Back on Things You Don’t Need
Everyone loves to live this luxurious lifestyle. As some wise people once said “treat yo self,’ which could be through binge-watching, instant gratification, or delivery services to name a few things that we love to treat ourselves with. However, in this instance, no don’t treat yourself but rather treat yourself to things that you absolutely need and cut out what you don’t. Yes, all these streaming services seem like a must but you know you need wifi and with that, you can bundle in cable too. Cable provides the same thing that streaming services do so you can say bye to that extra $10, $12, and $15 a month and save so much.3. Find Other Sources of Income
Your 9 to 5 can only provide you with so much money. You don’t graduate from college with a job that is going to offer you a six-figure starting salary. So your bi-weekly check shouldn’t be your main source of income. If you find yourself living paycheck to paycheck it’s time to sit down and get serious about another source of income. Leverage sites like Poshmark and Facebook Marketplace to sell things you have but don’t necessarily need anymore. If you do it enough you can generate a healthy amount of revenue on your yearly income.
Overall cutting back, implementing a strong budget, discipline, and maintaining that abundance mindset is the key to getting yourself out of debt. I hope that these three things and my story inspire you to take control of your money mindset and shift it to help you write a better financial story for yourself. If I can pay off $100,000 in debt so can you.