I have been flat broke quite a few times in my life. Actually, I could pretty much count my 20s as being an entire decade of living paycheck to paycheck, and there were a few times when there were no paychecks at all. I couldn’t help but wonder “how can I stop being broke?”

Here are a few things that I wish I knew then.

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What To Do When You Are Flat Broke

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1. Believe that your current financial state is NOT permanent

The prelude to any positive change is believing change is possible. Being broke is not a life sentence. You can absolutely change the course of your life by changing your actions. Nothing in life will get better until you start making different choices.

My husband and I had a couple rough years financially early in our marriage, but we changed direction by making better decisions. He worked every overtime hour he could, which also led to raises and promotions. I started handling household expenses differently, especially when it came to how much we spent on food and entertainment.

I guarantee you can improve your current financial situation too.

We all know people who go their entire lives struggling to make ends meet. Imagine yourself in five or ten or twenty years.

Do you see yourself being financially comfortable and maybe even building wealth?

Or do you assume you’ll still be living paycheck to paycheck? Do your future self a favor and start making better choices with your money.

Related: 7 Ways to Pay Your Mortgage Off Early

2. Be honest with yourself

It can be painful to face the truth, but you have to know where you’re starting in order to head in the direction of where you want to be.

When I was first deciding to be more responsible with finances, I created an account with Credit Karma. It’s totally free to use, and you can check your credit report and score as often as you like. It lists all your credit accounts, and shows which are delinquent.

This is very useful for figuring out your starting point for becoming un-broke. You’ll get nowhere with your head stuck in the sand. Make a list of your debts and add them up.

I think it actually feels better to know how much you owe. The unknown is always extra scary.

3. Adjust your variable expenses (aka stop spending!)

A variable expense is one that changes from month to month. It’s not fixed like rent or car payments or a phone bill. And the beauty of a variable expense is that you can control it.

Early in our marriage (when we were flat broke), we went out to eat all the time. On the weekends, we’d wander around Walmart, buying whatever we liked. Hmm, maybe that was why we struggled to pay the mortgage?

Are you wondering why you’re broke, but you go out to eat all the time? Do you shop as entertainment or smoke or drink fancy coffees? I’d bet that all that adds up to a hefty sum.

Don’t believe me? Look at your bank account for the past week and write down all the non-necessity variable expenses that you spent your money on. Multiply that number by 4, and you’ll see how much you spend in a month on things you don’t need.

If you change your spending habits, that same number could be what you have saved by the end of the month.

Or used to pay off debt, or got caught up on overdue bills. Imagine how good you’ll feel to not have the sickening broke feeling. It’s definitely worth giving up some happy hours and fancy coffees for. Long-term happiness and stability are always more rewarding than immediate gratification.

Related: Budgeting for Beginners: A Step-by-Step Guide for Getting Started

 

4. Educate yourself

In 2010, one of my good friends was getting divorced. In order to get her finances organized, she started listening to Dave Ramsey on the radio during her commute and watching the Suze Orman show.

She told me all that she was learning, and I was intrigued. She had a tangible plan for paying off her student loans, saving money, and was feeling in control of her financial situation.

I was impressed and wanted that for my life. I started watching the Suze Orman show, and continued to do so until it went off the air a couple years ago. (I’m still sad that it’s not on TV anymore!)

I read Dave Ramsey’s book The Total Money Makeover and read this and this book by Suze Orman. Since then I’ve read every book that those two wrote.

If reading books isn’t your style, search Google and Pinterest for tips on getting out of debt and being frugal. Learning all you can about improving your financial situation will further empower you to make the positive choices that will change your direction.

Related articles:

• Sticking to a Budget: 10 Budgeting Tips for Beginners
• How Set Goals You’ll Actually Achieve
• 12 Habits That Just Might Change Your Life
• The 13 Habits of Financially Successful People

5. Refine your goals

If you aim at nothing, you hit it every time, right?

Now that you’ve honestly looked at your current financial circumstances and know your starting point, you need to know where you’re going.

For goals to really be achievable, they need to be specific.  If you want to slim down, you don’t just make a broad goal to ‘lose weight.’ If you really want it to happen, you set an objective to lose xx number of pounds by a target date, and create some kind of diet and exercise plan.

The same goes for debt loss and saving. Set measurable goals, such as paying off your credit card in the next six months, or saving $50 per paycheck.

In The Total Money Makeover, Dave Ramsey talks about the Debt Snowball method. If you have debt, paying it down and then off is key to a healthy financial future.

Saving money for emergencies is also critical. Dave recommends having $1000 in savings for emergencies when you’re first getting started. That money could come from earning extra money or selling things you don’t use.

Here are some great tips on selling your stuff on Craigslist. You could also start a side hustle to earn extra cash.

I hope this post gave you some idea of what to do when you are flat broke.

Everyone likes to say that life is short. The truth is: Life is long, too.

And it’ll feel extra long if you’re always struggling with money.

It is, without a doubt, completely within your power to end the struggle.

Once you realize that you can change course and fess up about your current financial state, you’ve already made more progress than ever before.

Adjust your spending habits, learn all you can about paying off debt, and set goals for saving money. Your future self will thank you.

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Some more resources for making over your finances:

• The Total Money Makeover
• Total Money Makeover Workbook
• 9 Step to Financial Freedom
• The Money Book for the Young, Fabulous and Broke
• The Automatic Millionaire
• Women & Money

What financial struggle is holding you back?