It is never easy dealing with the consequences of addiction. For many, there are significant consequences of the legal variety that they will need to face during the initial stages of the recovery process. Relationships with friends and family will take time and hard work to heal. Many are also faced with the reality of being in serious financial trouble.
The consequences of your previous actions while you were using can be overwhelming, and many will be difficult to face. Facing reality is the most important aspect of the process of recovering from an unhealthy addictive lifestyle. Learning to live in recovery is more than just living a drug- and alcohol-free lifestyle. It is learning to live a responsible life.
Facing Down Your Debt
It is common for people who are new to recovery to discover that their addiction has left them with a mountain of debt. While this can initially seem overwhelming, there are lifestyle changes you can make to address your debt repayment issues. You really can put yourself into a place of being in good financial standing; however, there are many factors you need to consider.
What Triggers Unnecessary Spending?
Treatment teaches you to identify the many triggers of your substance abuse. You may face financial triggers as you learn to replace your unhealthy habits with habits that do not include turning to drugs and alcohol to cope with life’s frustrations. Many in recovery may turn to retail therapy as a coping mechanism that can add to debt. You can avoid overspending if you keep track of your spending habits so that you can keep your expenses within the parameters of what you can afford. Avoiding unnecessary spending is an important part of this.
Don’t Allow Yourself to Get Overwhelmed
Getting yourself out of debt takes time. Staying out of debt requires commitment. It is imperative that you handle new debt promptly to avoid increasing your existing debt. Being in debt can be an overwhelming feeling. Acceptance of the fact that getting out of debt to the state of being debt-free can take a considerable amount of time. Understanding what it takes to get to that point can keep you from feeling overwhelmed by it.
Ask for Help When You Need It
There will be times during your recovery when stress over coping with responsibility might bring you to the point where you consider relapsing into addiction. When it comes to your financial issues, there is help available whenever you need it. If you are having trouble meeting your most basic needs, like rent and groceries, you do have options, and it is okay to ask for help.
A good start would be to speak to a debt counselor from a non-profit financial agency. The National Foundation for Credit Counseling (NFCC) is such an agency, and it has convenient locations in every state. For more immediate needs, you may want to see if you qualify for government assistance such as the Supplemental Nutrition Assistance Program, also known as SNAP, for food stamps.
For the long term, you need to come up with a realistic debt repayment plan. To do this, you will need to take it one step at a time. The following steps will get you started:
Step One: Make a List
The first step to seeing what you are facing is to make a list of all of your debts. As you do so, make a note of what the minimum payment might be, as well as the total amount you owe and even the interest rates charged. This detailed list needs to include all of your debts, including credit cards, student loans, car payments, mortgage or rent, personal loans, past-due bills, and any money you may owe to family and friends. These are sometimes called “financial amends.”
Step Two: Order of Priority
Prioritize your list of debts by the order you believe they should be paid. Everyone has a different preference for ranking their debts, each with its own pros and cons.
Some people will be more motivated if they see results from their efforts. They may find that paying off their smallest debts first will motivate them to keep going. This is known as the debt snowball. If you choose to pay your largest debts first, it is known as a debt avalanche.
Others might prefer to rank their debts according to interest rate, with those carrying the highest rates the first to be paid. Some people prefer to prioritize their debts by who the debtor is and decide to pay friends and family first.
Once you decide the order of your bills, it is best to stay with your choice. Do not be tempted to stray from your chosen repayment plan.
Step Three: Immediate Need Debts
There will be some debts that you will need to address before the others. For example, if your electricity is about to be shut off or your landlord is threatening eviction, you will have to pay these debts first. If you are facing due dates that arrive before your payday, you should reach out to your debtors and ask to arrange a payment plan that aligns with your paydays. Most debtors are willing to work with you as long as you communicate with them.
Step Four: One Debt Paid, Start on the Next
Once you pay off the first debt, the amount you used to put toward that minimum payment in addition to any extra you were paying will now go to the second bill on your list. We all know how good it feels to get one debt paid, and you might even feel like you deserve a reward. Your goal of being debt-free will come much sooner if you stay committed and focus on the next debt on your list.
You may need to find additional income sources while you are working toward paying down your debt. This can mean re-evaluating your needs instead of your wants on your budget to cut down on spending, finding a part-time job, or asking for more hours on your main job. If you have things at home that you can sell for extra cash, that money should also be put toward paying down your debt.
Step Five: Time to Save
When your bills are paid off, it is time to start building up your savings. Having a savings account can help with unexpected expenses. You might even decide to start building your savings with small deposits while still repaying your debt. Financial emergencies can happen at any time, and being prepared will save you from adding to your debt.
Learning How to Budget
Financial literacy is not taught during treatment despite being as important as it is. It is a critical part of real life and should be an integral part of your recovery.
Keeping your budget simple is important. Your budget can be as simple as a handwritten list, or you can opt for other budgeting tools to help you stay organized. Whatever will keep you the most organized is the one that will work the best for you.
When you learn how to budget, you can avoid getting into more debt in the future. You can start setting goals such as saving toward a down payment on a house or a new car. Budgeting is not always comfortable, but it will help you avoid further debt and meet your financial goals. When you are putting together your budget, you will need to consider all of your financial obligations and not just your current bills.
- Current Financial Obligations: These are your monthly expenses, including rent or mortgage payments, utilities such as gas and electric, groceries, transportation costs, entertainment, and any other important regular monthly expenditures. It is always a good idea to set some aside for unforeseen expenses such as car repairs. You will need to review your budget each month to factor in such yearly expenses as car registration.
- Past Financial Obligations: While these can be uncomfortable to think about since you incurred many of these debts during addiction, they are still debts you need to pay. Budget these payments in with your current monthly obligations so that they can be paid off.
In sticking to a budget, you need to be consistent. In the beginning, this might mean writing down your income and subcontracting your monthly obligations. As time goes by, you will discover the tools that will keep you organized.
The difference between your monthly expenses and your monthly income is the amount you have left to disperse between saving and retirement, entertainment, and incidentals. Basically, this is your spending allowance for the month. You will have choices to make with this money. You can further budget it out with some extra categories or keep it as the amount you allow yourself to spend as you see fit.
The Difference Between Wants and Needs
As you set up your budget and begin to function within its parameters, you will need to pay special attention to the difference between things that you want as opposed to things you absolutely need. For example, when you think of the term housing, some people function with an apartment while others believe that they cannot settle for any less than a house.
Everyone has a different perspective; the manner in which you budget for your spending is based on your personal choices. Once you identify your monthly income, you can look at your spending allowance to determine if the amount of money you are setting aside for yourself can be considered as living within your means. While you might be able to afford the larger apartment, you might not be able to repay your old debts if you live there.
Determining needs vs. wants can come down to one specific question: Can you function comfortably enough without certain things or services? Or are they a luxury that you absolutely need to have? Realistically, depending on the amount of your debt, you might want to consider downsizing while you repay your debt. Your rewards can come later when you are debt-free.
Making Financial Freedom Part of Your Recovery
The experience of becoming debt-free can be compared to the freedom you experience from escaping from your addiction. Both feel absolutely liberating. Just as you are taking your life back through the process of recovery, accepting the responsibility for your finances and getting free of your debt are all important components of recovery. When you make becoming debt-free a part of your recovery process, you are taking a giant step forward on your sober journey.
Granite Recovery Centers
Granite Recovery Centers is there for you at every step of your treatment process. From the first days in detox, we are there to help. Our evidence-based treatment program supplies you with the tools you need for a sober lifestyle.
Each of our facilities is located in a tranquil setting that is conducive to healing. Our centers cater to all your needs for the long term with an aftercare program and sober living facilities. If you or someone you love needs drug rehab to get on the road to recovery, let us help. Our experienced staff of medical personnel, support, and psychiatric professionals can help you come up with a customized program that is focused on your well-being.