If you have made a lot of mistakes in life, wouldn’t it wonderful to be able to wipe your slate clean and start anew? To be more technologically relevant, wouldn’t it be great to hit the delete button, remove the unwanted lines, and have a blank screen to create a different story?

I’m sure that there are many people who wish that they could change their financial history in this way.

The reality is that you’re stuck with your past whether it harbours good or bad money memories. There is no life eraser that will allow you to remove the errors of judgement that may have caused you to frivolously waste money, borrow too much, make unwise investments or overlook opportunities that could have brought you fulfilment and prosperity.

Are you satisfied with your past but stressed about your present? Are you currently being battered by the financial storms of insufficient income and debilitating debt? Are your resources crumbling away under the economic earthquakes of business or investment losses? No matter what your existing challenges are, it is possible to overcome them and get a fresh start.

Rebuilding your finances

If you are reeling under the effects of your past and present money issues, there is hope. While you can’t adapt your life story to get rid of unpleasant occurrences, you can take charge of your actions today, in order to design a better tomorrow. Instead of dwelling on what could have been, use your experiences to help you to chart a progressive path for your financial future.

Although starting over again may seem like an uphill battle, you can successfully rebuild your life in stages. While you can’t recover lost time, it is very possible to replace your financial foundation and restore your well-being. The key is to erect a more secure structure that will be able to withstand any money problems that may arise down the road.

An architect makes a drawing outlining exactly how a building should be constructed; similarly, you too can create a life plan that will determine how your financial house should be put together. Your blueprint should give details about your desired lifestyle by describing your dreams, indicating specific money objectives and setting timelines for completion.

Laying a strong foundation

The first phase in creating a solid financial base is to use a budget to make a record of your current spending requirements. You can download a budget form at www.financiallysmart.org. Many people try to skip this process, thinking that it’s pointless to budget if they don’t have any money. However, it is impossible to create a stable financial structure without budgeting.

The purpose of budgeting is not to simply try to allocate the limited income at your disposal across several expenses. A proper budget seeks to help you to determine exactly how much it will cost you to live for an entire year. It allows you to become aware of where your spending dollar is going, and to make appropriate choices that will be in line with your goals.

When done accurately, your budget may show that the cost of your lifestyle is way in excess of your earnings. It will indicate whether you are spending too much on non-essential items or if you are really not making enough money for your basic needs. Your budget will therefore allow you to see where you need to cut back or earn more in order to satisfy your lifestyle requirements.

Making building blocks

Whether you created a small cottage or a large mansion design for your financial house, you must be able to make enough building blocks to complete your desired structure. Your ability to create these blocks will depend on your efficiency in earning an income. In other words, if you don’t generate enough money, your financial dreams will not come to reality.

We’ve all seen an unfinished house which the owner started building with high hopes, but eventually ran out of steam or resources to complete. Similarly, if you start constructing your financial house with insufficient income to pay your bills without incurring debt, save for stability and invest for growth, you will find it difficult to accomplish your objectives.

Many people think it is challenging to raise extra money because they possess an employee mentality about income generation. They expect all their earnings to come from one source – their 9-to-5 jobs. The problem is that our economy no longer supports this model for the average employee; you have to make use of your spare time to bring in more money for your goals.

To succeed with your rebuilding plans, you need to become more productive with the use of your free time. Get money-making ideas by surfing the Internet, reading entrepreneur magazines, and looking for opportunities wherever people have problems. You can find lots of suggestions how to use your talents and resources to earn money right  HERE.

Next week, I will continue to look at making a fresh start with your money, by examining the other elements involved in building a secure financial house.

Copyright © 2012 Cherryl Hanson Simpson. No reproduction without written consent.

Originally published in The Daily Observer, October 11, 2012

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