Finance

What should you do when you are living paycheck-to-paycheck AND you have lost your job?

With over 70% of Americans living paycheck-to-paycheck, this is a great question to ask!

When you are living paycheck-to-paycheck, bills go past due THE VERY INSTANT you miss ONE paycheck.

So what should you do if you are in this situation?  Below is a list of things that I would do IMMEDIATELY if I were living paycheck-to-paycheck and lost my job.

1. PRAY!!!  It really does work!
2. Call every single creditor you owe and inform them of your situation. Humbly ask them to help you.  Ask them if they would please lower the interest rate to 0%, charge no fees, and give you three months of no payments.  Most of them will work with you!!!  Communication person-to-person works so well!!!
3. File for unemployment.
4. Immediately cut out all non-essential expenses.  Get rid of the cable, internet, home telephone (keep the cell phone), gym membership, etc.
5. Get a job – ANY job! Obtain a job that earns something to help bridge the gap between full-time positions.
6. Apply for a better job. Apply for new jobs on monster.com, linkedin.com, hotjobs.com, and the newspapers.
7. Prepare a spending plan. Spend all of the money you do have on paper BEFORE you actually receive the money.  In other words, start PLANNING your spending!  Free tools are available by clicking on “Tools” at the top of the page!

By the way, if you are living paycheck-to-paycheck, but still have a job – consider yourself warned!!!  You might be laid off TODAY! What would your family have to do if you lost your job TODAY?  Why not make today THE DAY that you change your family’s entire financial future?

Looking for additional Personal Finance Resources?  You can obtain free tools by clicking HERE and purchase books/materials by clicking HERE

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30: “A heart at peace gives life to the body, but envy rots the bones.”

31: “He who oppresses the poor shows contempt for their Maker, but whoever is kind to the needy honors God.”

As I help people get their finances in order, I cast vision as to “how things could be” IF “they would just do this, this, and that.”  Many times this involves selling some stuff – cars, boats, motorcycles, houses!  I want people to have nice stuff, but many times the nice stuff is eating up 50% of their budget OR MORE.  People just will not win with expenses like that!

As I cast vision, it is not unusual for me to say, “If you sell the two cars and buy two used cars, you could be debt-free except for the house in 12 months.  If you choose to keep the cars, you may be debt-free in 60 months.” Or I might say, “If you sell the boat and motorcycle, you could be debt-free immediately.  If you keep the boat and motorcycle, you may be debt-free in 72 months.”

When I mention selling some stuff, I begin encountering resistance!  This is their stuff!  They love their stuff!  They bought this stuff, and they want to keep it.  Even when it is eating them alive financially!  Even when they are not able to give one thin dime and are not assisting others at all!

As I go through meetings like this, I see that God’s word is true.  Proverbs 14:30 says that “envy rots the bones”.  When people have a bad case of stuff-itis, it is usually a result of envy.  They saw someone else with that item, and they wanted one too.  The difference is that they could not afford it.  The verse also says that “a heart at peace gives life to the body.”  When stuff-itis is cured, WOW!  The peace is awesome!  Knowing you could go to the store and buy anything in there, but not doing it because you really don’t need anything.  I am telling you it is AWESOME!  Jenn and I have been vaccinated against stuff-itis, and it feels good!

Proverbs 14:31 says that “whoever is kind to the needy honors God.”  I guess that is why it pains me so deeply in my soul when I see people up to their eyeballs in debt with a bad case of stuff-itis.  They are so loaded up with their own wants that they do not even see the the needy, let alone help them.

The solution?  Get a vaccination against stuff-itis!

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This is a series that appears on a regular basis here at JosephSangl.com – “Biblical Financial Lessons”

Nehemiah 1

While Nehemiah was in the city of Susa, his brother Hanani came into town from Judah.  Nehemiah asked him how things were in Jerusalem, and the answer he heard absolutely wrecked him.  Hanani responded, “Those who survived the exile and are back in the province are in great trouble and disgrace. The wall of Jerusalem is broken down, and its gates have been burned with fire.”

When Nehemiah heard of the terrible plight of Jerusalem, he was distraught and devastated. It is recorded that he said, “When I heard these things, I sat down and wept.”

You see, Jerusalem had no wall which meant that they had no protection!  In other words, they had no margin.

Think about it. If they grew crops or built something of value, their enemies could approach without anything blocking them. Without margin, the city of Jerusalem was in great trouble and disgrace.

There is a huge financial lesson to be learned from this story. Without financial margin, a person faces great trouble and disgrace!  If you ever want to truly prosper, you MUST have margin. Margin offers protection against whatever life may throw at you.

If Satan can keep you broke, he can keep you ineffective.

Here are some fundamental truths:

1. Life IS going to happen
2. WITHOUT margin, you will face incredible challenges, stress, and anguish
3. WITH margin, you will have a defense that allows you to remain focused on the mission and vision of your life
4. It is easy to achieve BROKE. It requires focused effort to build and maintain financial margin.
5. You CAN do this!

Just as we can learn from the book of Nehemiah, the first step toward establishing margin is to recognize that we don’t have it and that we need it!

Do YOU have financial margin?

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I could never have attended Purdue University had it not been for student loans. I began dating Sallie Mae right away, and it took years for me to break up with her. With that said, there are several that every student should know about student loans. Here are five of them.

1. Go to school for 4 years for a 4 year degree Or for 2 years for a 2 year degree. Not six years for a four year degree. This can have substantial financial consequences. For example, if you attend college for two years more than required for the degree, you will have to pay for two extra years of school PLUS you will forfeit the salary you could have earned during that two year period. For many people this is a $100,000 financial swing!
2. Obtain a degree that will help you repay the loan There are many people who go to prestigious private colleges to obtain a degree that is the equivalent to underwater basket-weaving. While I think that underwater basket-weaving would be amazingly cool, it probably won’t help repay the loans. My mechanical engineering degree from Purdue University and MBA from Clemson University certainly helped me repay my student loans.
3. Tech or Community College for the first two years can really lower costs Most states have established programs that allow all credits earned during the first two years of community college to transfer directly to the state schools. I have seen the costs for community college. They are much lower than state or private universities. The local community college where I live is literally one-third the cost of the state school.
4. Obtain subsidized loans if possible Subsidized loans do not accrue interest while the student maintains at least half-time student status. They also do not accrue interest while the loans are in grace periods or deferment.
5. The name of the college does not matter nearly as much as the effort you put into your studies Many students fall in love with a particular college and feel that they just must attend only that institution. I have discovered that no one really cares about the fact that I went to Purdue and Clemson – all they want to know is if I can help them accomplish their stated objective.

Print this out and have a conversation about it with your student or future student. My bride and I have been talking about this with our daughter since she was six or seven. I know it might seem like boring conversation, but I promise you that it has had a positive impact on our daughter and the plans she has made for education.

I have written an entire chapter on this topic in my book for high school and college students – What Everyone Should Know About Money Before They Enter The Real World – I promise you it will help financially prepare your student for the real world. You can purchase that book HERE or for your e-reader HERE.

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Romans 7:15 – ¹⁵ “I do not understand what I do. For what I want to do I do not do, but what I hate I do.”

Paul shares his thoughts on his struggle with not doing the right thing and doing the wrong thing.

This is a problem everyone faces – especially in the following areas of personal finances.

• Budgeting  We know that we should prepare a monthly written Give/Save/Invest/Spend plan, but for some reason we don’t allocate the time and effort required to make it happen.
• Giving  We know that we should give, but we fail to do so when it comes time to write the checks or pay the bills on-line for the month.
• Saving  We know that we should be saving money.  After all, the children are growing like weeds, and it seems like they will be headed to college tomorrow!  The car has special “rattling” sounds, yet we have not saved any money to repair or replace it.
• Investing  We know that we should be investing to fund our big-time dreams and prepare for retirement.  After all, our bodies are creaking, and it seems to take much longer to get rolling each morning.  Yet, we choose to invest little to no money to cover our living expenses and live life to the fullest during our retirement years.
• Wills/Estate Plan  We know that we will die someday, but we choose to ignore that reality by failing to have a written will and estate plan.
• Insurance  We know that we are going to get sick one day.  Yet, we choose to not have health insurance.  We know that law requires us to carry insurance for our cars and that we will probably be in a wreck someday, yet some still choose to drive without auto insurance.
• Debt  We know that substantial debt can delay or completely prevent the funding of our future plans, hopes, and dreams, yet we choose to “sign the line” anyway.

The LIE that we tell ourselves is this:  “Things will be okay.  After all, we have made it this far living this way.”

If that is you, let me ask you a few questions:

• Are things REALLY okay?
• Are your dreams fully funded?
• Are you living the life you dreamed of when you were young?
• When was the last time you really allowed yourself to dream?

What do you need to do?

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