Thursday, April 24, 2008

When Do You Let Things Go?

As always, I've been thinking about budgeting and money management. Most recently, I've been thinking about when people let go. Let go of bad habits, let go of restrictive habits.

Personally, I created my personal finance spreadsheet when I realized my debt load was not in any way close to what it needed to be if I wanted to buy a condo. It wasn't a matter of me getting to a point of debt where I couldn't live on what I was making, or when I was in the red in my bank accounts. In fact, I had several thousand dollars in the bank.

I know with relationships, many people have a tendency to stay in a bad relationship, because it's felt like ending it and starting something new would be too hard, or inconceivable. Or maybe they stay in the relationship because they like one quality, and convince themselves that that is enough to keep holding on. The latter happened with me and my last ex-boyfriend, and it was difficult to talk with him and break it off. I knew it was for the best, but it still hurt a great deal to do it.

Is being in a bad cycle with debt like being in a bad relationship? I think it is.

Is the turning point for other people hitting rock bottom financially? Do other people realize that in order to meet a certain goal (e.g. home ownership) they need to change their ways? Is there another factor that pushes the decision to change financially?

What do you think?

2 comments:

Rachel @ Master Your Card said...

I think with me it was a very slow realisation. Our joint income reduced and I had no job so I did some research about money. I realised that if I wanted more money I would have to work hard for it and I could not expect to be handed it on a plate - that was my first big realisation. Then I decided that the best financial move we could make was to pay off our mortgage early and that changed my spending, investing and earning habits drastically as I am now focussed on achieving that goal as quickly as possible.

mary w said...

My husband and I are struggling with this right now- we had to "let go" of a 15 year mortgage and go to a 30 year-it was hard but the payment on that 15 year mortgage was killing us every month-it took awhile to help him realize that just because the mortgage says the final payment is due in 2038(GASP) it doesn't mean we can't pay it off early if our financial circumstances change in the future.
The 2nd challenge is knowing when it is time to let go of my small business-I own a small paper arts store and we are three years into it and we aren't seeing a profit yet-in fact we are about $30,000 in the hole-when is it time to say OK enough is enough, this isn't going to work and its time cut and run??
No one ever talks about the emotional side of financial decisions.