In a Netflix special I was watching the other day, comedian Dave Chappelle told a story about a single event in the civil rights struggle and how this ugly, uncomfortable situation in American history became the catalyst for something extremely important. He explained that focusing on the ugly event was like standing too close to an elephant, where you miss the entire picture of the situation because your focus is to narrow. The enormity of the elephant close up overwhelms the entire picture.
Similarly, your financial decisions should encompass the larger picture of your entire financial picture including these 6 Key Areas:
- Opportunity Costs
- Credit Ratings
When you feel like you’re circling the drain in a financial problem, it’s easy to get trapped up close to the elephant, focusing only on the big, overwhelming picture. My advice is to step back from the problem and review the situation in light of the totality of your financial picture in order to find solutions where you least expect.
For instance, are you having trouble each month paying your rent or car payment? You can look at the fact that you don’t make enough each month and pound away at trying to work more or harder until you’ve used all your time, lost sleep and find yourself working merely to survive but not actually live. OR, you can step back and evaluate all the areas listed above:
- Are you withholding too much income tax from your paychecks? Do you normally get large refunds during tax season? Why are you suffering each month so you can get a short break at refund time? Adjust your withholding so you bring home more of your money each month to use when you need it. Need help with this? Contact us!
- Is your income commensurate with your skill and experience? Should you look for better opportunities that pay better or offer better benefits? Or are there side gigs or other ways to add income or lower expenses? (Side Note: Remember you need to pay taxes on those side hustles – I have a post coming up on that soon!)
- Do you have savings so that you have options to change your job, or your living space or are prepared for short times off for sickness or to re-align yourself? If you do have a savings account, is this the proper time to tap into it to create more space for opportunities to change your lifestyle.
- Is your debt at the lowest possible rate? If you consolidate debts can you lower your monthly payments?
- By living where you are or buying what you do or working where you are, are you stifling the chance to move forward in your career, your lifestyle and your opportunities?
- Are you taking care of your Credit ratings appropriately so that you create options for better debt management, better chances to jump on good opportunities, better choices for rent, auto purchases, business growth?
Need help finding solutions by looking at the whole “elephant?” Contact Us!
We’ll chat again soon!