Last week we discussed the different causes of financial distress. Many a time financial distress is not as a result of a one off event but as a result of poor financial decisions cumulatively leading to the financial distress.
The first step in dealing with a personal financial crisis is to accept that there is a problem and stop wasting further time that is procrastinating in trying to address the financial distress. Unfortunately, it is at this moment when people begin wasting time in things that may not add to solving their financial problems but only make it worse e.g. alcoholism, gambling, acquiring more debt to deal with current debt thus avoiding the real cause of their problem.
If one is totally overwhelmed by the poor financial situation that they find themself in then they can take some time out to refocus and get mental energy to deal with the situation at hand.
To deal with personal financial distress one needs to be in good physical, spiritual and mental health.
One needs to be very honest with ones spouse and family members/dependants and inform them that things indeed are not rosy at all financially. Tales are told of people who have lost jobs and day to day put on a semblance to their family members that things are okay financially, pretend on days on end, dress up and pretend that they are going to a phantom job, refusing to accept the reality of matters at hand. Honesty at this moment with ones family members is paramount as lifestyle changes to reduce expenditure will have to be made to deal with this financial stumbling block as a way forward is sought. If the financial distress is because of a mistake that one made e.g. engaging in a pyramid scheme, gambling or a deal that went sour that compromised ones family’s financial stability one has to own up on the same and together with ones family seek the way forward. Honesty for those who are married or in a financial agreement with a romantic partner is very important as financial matters are a leading cause of marital and relationship break down when people are not fair to their spouse or partner or take advantage of them financially.
Get a trusted friend to own up to on the financial challenges you are facing. A few Sundays ago our dear pastor narrated to us how there was a time that he was undergoing immense financial challenges that necessitated him walking long distances as he could not even afford fare for a “matatu” ride, on narrating his financial woes of yester year to a close friend many years later, only for the friend to narrate to him that at the very same time his finances were thriving and that on the very day they bumped into each other in Nairobi’s CBD, the pastor looking a bit haggard and tired, his friend had around Ksh 100000 on him which he would have helped him out with had he known that he was suffering a financial crisis.
The same trusted friends you reach out to may help you out financially, will give you advice on job openings, business opportunities, share with you how they surmounted similar financial challenges themselves and hand hold you through this period of a financial storm. True friendships are important in life, nurture them. Friendships where you can bare the good, the bad and the ugly of your life. True friendships like diamonds are rare but precious.
Journaling or working your way through writing and keeping tab of your financial progress through this financial hole is also very important.
One would have thought that to deal with personal financial distress is just a matter of only managing the money bit, well not exactly.
Ensure that you eat a healthy diet to keep your body and mind fit.
Engage in FREE leisure activities that nourish your body, mind and soul. Make sure that you have adequate sleep.
When undergoing personal financial distress, there is no two way about it, one must be frugal with ones expenditure. This is the time to cut of unnecessary expenditure and monitor all your personal finances to the last coin.
No new purchase of unnecessary items and make do with what you already have for example clothes. Seek alternative and cost effective sources of items e.g.growing your own vegetables, going to Wakulima Market for your own household purchases instead of purchasing them in the nearby fresh produce grocery store if you have not already been doing so. If you have been driving, there is no shame in now using a matatu as only you know where the shoe pinches. If one is heavily in debt, or highly illiquid that is has no money and has no money for survival it may mean selling off some of your assets and personal effects until you are back on your feet again. It may mean selling off your car, and using the money obtained to survive and pay off debt for example. It may mean giving out some of your clothes to second hand clothes dealers to sell in exchange for money. It may mean moving out of your current neighborhood, renting out your own home as you rent a house in a cheaper neighbourhood to make some income. If push comes to shove it may mean changing schools for your children to those that demand less school fees, doing without a househelp if you have one and doing your own housework. Ladies, we still have to keep looking “hot” despite challenging economic times as it is a self esteem booster. However, during such times learn how to do your own hair, beauty and makeup treatments on your own. Do it yourself.
Use the resources that you already have to get by. Instead of eating out as you are used to, learn how to make interesting recipes at home. If you used to take out your children during the weekend, get fun cost effective alternatives like enriching home movies, board games, go and play some soccer with them in the field next to your home. Only you know where the shoe pinches, never forget that. Take what are known as austerity measures to reduce any further financial distress.
Devise a plan on how to get back on your feet financially and work on it every single day. Stop ruminating in the happenings of the past, feeling sorry for yourself and act. If it is a job you lost, instead of dwelling on, “walinionea, nikapoteza kazi yangu” (Trans. They were against me and is how I lost my job), review the skills, resources, networks for job and business, experiences that can earn you income before you get a stable source of income again. Engage with others who have undergone similar circumstances, read books on how others have coped with personal financial distress, get the help of a financial advisor if you can afford it.
Do an honest self examination and look at the behaviours that may have sabotaged your financial well being in the past and learn from them.
Tough times do not last but tough people do. Giving up is never an option. Where there is a will there is a way.
Never forget that even if you are facing challenging financial times, even if perceptions of others of you change to the negative, your worth as a human being does not diminish before the eyes of God, your life is precious before Him in the same amount as the wealthiest man or woman on earth. Keep on fighting to get your financial groove on back again.
Putting a cap to this week’s musings on how to deal with personal financial distress.
Next week, we will be reviewing the eight behaviours that sabotage personal financial well being as shared by Mr. Wahome Ngari of Citadel Consulting, Nairobi in Radio Waumini, Kenya this past week.
On that note here is to an awesome BAKE Awards 2018 Winners Gala Dinner, slotted for this coming Saturday at the Crowne Plaza, Nairobi. Thank you Jehovah, you make all things beautiful in Your own time, Wacha niKwambie may the best blogs in Kenya win ;-)). Here is to the best blogs in Kenya today! I do look forward to an awesome evening and meeting my fellow bloggers in physical life.
A great day to all wherever this blog post finds you at!
© Kwambie Nyambane,
The writer to this article is a Business Development Consultant. The article is churned from her professional experience and training. She holds an MBA from the University of Nairobi. In the past she has worked as a Relationship Manager and Senior Business Advisor in the financial services sector. She has a deep interest in human Wellness matters, which includes financial wellness. This article is for awareness purposes. If one needs professional advice to address personal financial needs please seek the services of a personal financial management expert.