Guest post from Jamie 0f Medium Sized Family
You’re walking along just like any other day, when you notice mud caked between your bare toes. That seems odd — then you glance around and notice how dark it is. Your eyes catch the sight of a dirt wall. You eyeball the wall all the way up, and that’s when you discover the sun is even further away than usual.
You’re in the bottom of a pit.
You shrug your shoulders, grab a shovel, and start digging.
To the outside observer, that seems absurd. How can you hope to escape a deep hole by digging it even deeper?
Real people do this every single day.
They discover how deep they are in debt, but figure they can’t do much about it. So they just continue digging deeper as if it makes no difference.
If this sounds like you, it’s time to make a change!
You can get mad, do a complete turn-around, and start attacking your debt (if you’ve got the fortitude to make that kind of total change, you rock!) But I’ve got bad news for you; attacking your debt is kind of like trying to climb the dirt walls of the pit with your bare hands. It’s going to be really hard to succeed.
What you really need is a safety harness and maybe some rocks to grip. But how do you get those supplies from the bottom of a pit?
You ask for help from people who’ve already been there!
The Safety Harness = The Emergency Fund
I know you might be excited to dig into your debt, but before you start paying off your debt, the first thing you should do is build up your emergency fund.
I should mention that if the amount of debt you owe is small (less than $1,000) and you make a decent income, you might do just fine attacking debt before building your emergency fund… but, in my experience, most people owe much more than $1000, and are barely making enough to get by.
If that sounds more like your situation, you first need to wrap yourself a safety harness (a.k.a. an emergency fund).
Before you tell me you don’t have time or money to build an emergency fund, let me tell you why it’s important. An emergency WILL happen — probably sooner than later. For our family, it was a major van breakdown just two months into our debt repayment.
Then what? If you have credit card debt, I bet your habit is to whip out the card to cover your emergency… right? If you do this, you not only wipe out all the progress you made paying off the card, but you also reinforced the habit of grabbing the credit card when the going gets tough.
You might not realize it yet, but you need to learn what it feels like to turn to your bank account when you need to cover an emergency. And while you will have to send any extra debt payments to your bank instead (gotta rebuild the emergency fund), saving money rather than repaying debt (again) is a whole different feeling.
Where to Get the Money
I realize that if you’re already deep in debt and struggling with money, an emergency fund might sound like an impossible task! But look around. When you’re in the bottom of a pit, you have to do just a little bit of the impossible to get out.
YOU CAN DO THIS!
Don’t expect to find money for an emergency fund by doing the same old thing. Make a big change — cut your spending dramatically for a month, sell things to gather the money, or take on an extra part time job.
None of these things should last forever. If you struggle hard for a month or two, you should be able to come up with a few hundred dollars to start your emergency fund.
Doing this has been tough on our family, but we like to think that our kids will remember this struggle when they are older. Hopefully it will put a bad taste for debt in their mouths.
Now, what about those rock grips I mentioned? Clawing at the dirt while you try to reach the top is a scrappy way to get out of debt. But an easier way to do it is to learn from people who already got out of debt. Climb the same rocky path they used, and you’ll get there faster.
My Hubby and I are Dave Ramsey fans (although we don’t follow his advice exactly). We like his baby steps approach to getting out of debt and turning your financial life around.
Crystal has a free ebook: 5 Days to a Better Grocery Budget that might be the perfect way to learn how to change your spending habits from someone who obviously knows how to pinch a penny.
Search out other blogs about getting out of debt and follow them for more help and encouragement.
Remember, making a change might seem intimidating, but it will be worth it in the end! Pull together an emergency fund and start paying down your debt now.
And whatever step you choose to take next… please put down the shovel!
Do you have an emergency fund?
Jamie dreams of donuts appearing at the desk where she writes her blog, Medium Sized Family. You’ll often find her juggling her 5 kids’ activities while chugging coffee. Check out her Secure Your Savings and Find Peace in the New Year series with 30 ideas for building your emergency fund.