Fix burnout and keep momentum going with these tips!
There are two things that can really derail your Personal Finance Journey. The first is any type of financial crisis – being laid off, a medical emergency, or an unforeseen expense. You can’t do much to prevent these incidents from ever happening, but you can prepare for them by setting up an emergency fund, paying for good insurance, and having a side hustle to fall back on.
The second thing that might ruin a Personal Finance Journey is burnout. Burnout, sometimes caused by boredom, can be extremely detrimental to your finances, particularly if part of your journey is to pay off a large debt.
Inevitably, you’re going to feel helpless at some point on your way to Financial Independence. I understand, because I have been there. Here are some reasons you might be feeling burnt out, and ways you can counter these feelings.
Your efforts aren’t bringing you closer to your goal.
When interest takes up a chunk of your monthly payments, it is really hard to focus on the progress that you are making. For instance, my husband and I had to take out a loan when we needed a new roof for our home. Even though we pay $200 per month on this loan in order to pay it off quickly, seeing the $40 interest charge every month is extremely discouraging.
Try paying just a little more each month to counter the feeling that your efforts aren’t enough. If I upped our payments to $240 every month, I would feel much better. Having a full $200 applied to the principal, instead of only $160, would make our interest charges drop faster.
You can also try thinking positively! This is a hard one for me for some reason – while I am normally an extremely positive person, when it comes to my debt I always look at the negative side. I lament the amount of money going toward my unwelcome interest instead of focusing on the dropping principal balance. Set up a tracking sheet that lets you watch your principal balance drop every month. While looking at this sheet for only 1-2 months may not make you ready to dance for joy, imagine how great it will feel to look back over 8 months or a year and see the progress you have made!
That extra $20 won’t help, so why not get a treat instead?
Similar to problem of interest-based discouragement is the concern that the extra money you have to put toward debt isn’t enough. After all, what is $20 if not a great lunch out with some friends or coworkers?
Do the math: numbers don’t lie! If you have an extra $20 per month, you actually have an extra $240 per year. While that won’t make you rich or pay off any overwhelming debt, it is helpful.
What if you had an extra $20 per week? You’re looking at $1,040 by the end of the year. You can’t tell me that wouldn’t help your financial situation! So get moving on a side hustle, like tutoring, and put that extra $20 to good use.
You can never work hard enough to make the progress that you want.
This is a very frustrating situation to be in; it reminds me of being in limbo. You may be working very, very hard to pay off your debt or reach your goal emergency fund, but it will never seem to go as fast as you want it to.
Ask yourself this: is the progress you want reasonable? If you’re like me, it’s likely that the answer to this question is no. I want to pay my loans off in a year, maybe two. Paying of a 20-year loan in 15 years isn’t enough progress for me. However, when I consider my situation rationally, I realize that this is a process I can only rush so much.
Progress is progress. That’s it. Learn to accept the progress you are making, and soon you will reach a tipping point: when your emergency fund finally reaches 6 months of expenses, what else can you do with that $10, $75, or $500 you were contributing each month? You can make more progress elsewhere!
The debt snowball is an excellent way of remembering this and seeing it in action. When you finally pay off a loan that costs you $80 per month, you can add that money to payments for a loan with a minimum payment of $100. When you finish paying off that loan you can add your $180 to a loan with a minimum payment of $200 per month. Again, do the math and you will see that your progress will get you somewhere, even if it feels like you’re stuck right now.
You’ll pay off the debt by the end of the 20 year loan period, so why stress yourself out now?
Burnout leads to contentment, and I do not mean that in a good way. When you feel helpless, or think that your progress isn’t worth the extra stress you’re taking on through many side jobs, it’s easy to sit back and wait for your loan term to eventually reach completion.
If I were to sit back and pay the minimum on my student loans, my unborn child would be 7 years old before the first one is paid off. That is unacceptable.
Use time management to avoid burnout, such as being sure to plan your work days well. This can prevent you from feeling overworked, thus helping you to work harder to reach your financial goals sooner.
I’ll say it one more time: do the math! In this case, “the math” could refer to:
- All the money you are wasting in interest payments by keeping a loan around for its full term.
- How old you, your spouse or your children will be by the time you finish paying off your existing debt.
- How many vacations you could take with your monthly debt payments.
- The number of hours you are wasting at a job you hate because your emergency fund isn’t large enough to allow you to pursue your dream job.
That was my tough love for you today. These numbers can be downright terrifying, which leads me to my last potential stumbling block for your Personal Finance Journey…
Fear. Paralyzing fear.
Maybe you aren’t necessarily burned out; maybe you are just crippled by the numbers you saw as you did the math above. All of the above reasons for burnout might flood into your mind, and you can’t possibly see a way out of your scenario.
Breathe. Let your mind clear itself for a moment.
Make an action plan. Remember, progress is progress, and $20 each month makes a difference. What can you do right now to help yourself begin? What can you do each week to keep yourself on track? What can you do each month to remind yourself that progress and positive change are happening?
Keep track of your successes. While noting your failures is a good idea so that you don’t repeat past mistakes, make your successes your primary focus when you feel fear creeping in on you. Reminding yourself of all the good you have done, and all the progress you have made on this journey will keep you refreshed and motivated.
How do you cope with burnout?