Made a poor financial decision that you regret? You are not alone. Most often, our impulsive buying of things we don’t need brings us into such a situation. But, our financial problem will disappear after a few months, and the only thing that remains is that glorious monument of our silliness somewhere in the attic to remind us of it for the rest of our lives. However, some bad financial decisions leave more grave consequences and can plague us for years to come. Then we feel guilt and remorse and have anxiety and insomnia. All of that affects our mental health. But despair will get you nowhere. Use this situation as an opportunity to learn and come out of it stronger and better prepared for future challenges. We suggest six ways to cope with bad financial decisions that will allow you to do just that.
1. Acknowledge the mistake and identify the problem
The first thing you have to do is to admit your mistake without assigning blame to others. Even if our financial problems are partly the result of external factors beyond our control, focusing on our role is the only thing that will help us solve them. Brooding about things beyond our control will only increase feelings of helplessness and anxiety. Identify the central sources of your financial stress. Try to make a list of the problems you’ve noticed and the time frames in which you intend to solve them. Make sure to put at the top of the list those actions that can give you results in the short term. It will affect your morale and give you the strength to continue with the more difficult decisions that await you.
2. Make a monthly budget and stick to it
A budget is a great way to regain control of your finances. It will help you limit your spending. Write down all your income and all that you spend over one month. Try to save all the bills and receipts you received during that period. You will get a clear picture of how much money you actually spent. Budgeting by recalling the expenses you incurred two or three weeks earlier often leads to mistakes and underestimating the actual costs. Make a financial plan for the next month. Prioritize essential bills first. It will force you to categorize costs by importance, helping you to recognize expenses you have had until now without really needing them. Once you have a complete picture of where your money goes each month, you’ll find options to save or redirect some of it.
3. Discover your triggers and try to avoid them
Apart from the importance of clearly defining and acknowledging the mistakes that got you into financial trouble, it is also necessary to determine if there are deeper reasons why you are making such mistakes. What is the trigger for such behavior? Perhaps the excitement you feel has made you invest money in uncertain investments. Loneliness or boredom can be the reason why we spend a lot of time on the Internet and in front of the TV, which is why we spend a lot of money on online purchases. Is buzzed buying the cause of your buying stuff you don’t need? Try to avoid this by working on the issue that caused you to make financial mistakes. Find a new hobby, go out with friends more, or engage in physical activity.
4. Learn from your mistakes
This advice applies to all life situations. In case of wrong financial decisions, even more. You won’t get any benefit from torturing yourself over the poor financial decisions you’ve made. You need to learn to cope with bad financial decisions and move on. In order to move on with your life, you must forgive yourself. You don’t want to lose confidence in yourself and the future decisions you make because of this bad experience. Living in constant fear of making mistakes is not the answer. Nobody is perfect, and we all make mistakes sometimes. That’s why it’s essential to learn the lessons from your mistakes and move on with confidence. But in the future, enriched by this experience, you will make different choices.
5. Find ways to make more money
Saving is a reasonable way to reduce your expenses and solve accumulated financial problems. But even saving has its limits before it starts to affect the quality of life beyond the limit you are ready to accept. Perhaps, in that case, you should look for ways to increase your income.
Some ways to do this include:
– Working-overtime
– Take a second job in your spare time
– Sell items that you no longer use.
– Find a roommate and additionally reduce your living expenses
This way, you will prevent compromises in terms of the quality of life. It will also help you to divert your thoughts from current problems. Once you have solved your current crises, you can reduce your working hours to the previous level if that suits you better.
6. One way to cope with bad financial decisions is to ask for help
When solving financial problems you have fallen into, it can be invaluable to talk about them with a person you trust. Explain to them the nature of the problem you are having. Tell them about how you plan to deal with it. The benefit you can have is various. First, you will get the opinion of a person who sees the problem from a different perspective. Maybe she has had similar experiences and can give you practical advice. It might help you to solve the problem you currently have more efficiently, but also to plan and manage your finances easier in the future. Also, once you present your plans to a person you care about and respect, you will have more motivation to stick to that plan.
Final words
You may have made financial mistakes that you regret, but keep in mind that they happen to everyone all the time. We hope that our text will help you cope with bad financial decisions. Think of them as an opportunity to learn significant life lessons from everything and move on with life empowered. Forgive yourself, but not in a way that relieves yourself of responsibility. Make changes in your life that will prevent similar things from happening again.
