3 Steps To Recover From Financial Devistation

Balancing Rocks

Financial setbacks come in all shapes and sizes.  Most of us have experienced this at least once in our lives, for the rest, its not a matter of if but when.  Just this week, another friend is going through a divorce.  With divorce inevitably comes financial devastation on top of the emotional rollercoaster.  If kids are involved, well, this roller coaster just turned into a 5 point harness deluxe ride.

Based on my own financial devastation to recovery journey and in listening to her and others that have gone through the same, it occurred to me that there are 3 basic things one can do to survive and even thrive in such an environment.

Take Stock

Once the dust has settled, the first thing to do is to take stock and pull your credit report and credit score.  Gather up all your assets and liabilities and determine where you are.  In other words, calculate your net worth.

This is a really scary step, but the sooner you rip the band-aid off the sooner you can get to work to repair the damage.

Remember that your net worth calculation is just a point in time.  As the country song says, “when you hit rock bottom there are only two ways to go, straight up and sideways”.

Which leads me to step 2.

Make a Plan

Based on you are today and where you need to be, start making a list of things you can proactively do to get back on track.  Nothing is more empowering that being able to stand on your own two feet.

Be PRO-active not RE-active.

Once you have a list of things you can proactively do, begin organizing that list in the order you plan on executing.

Level Up

When you have a large goal, like recovering from financial devastation, its important to break up the road to recovery by levels.  Start with small easy goals that give you the biggest bang for effort.  For example, if you have a bunch of credit cards with various balances that you want to have paid off.  For each one paid off, treat yourself with a small yet satisfying reward.  This reward doesn't necessarily cost money but it should be something you want to do or have.

For every achievement, give yourself a little celebration.

Change Your Mindset

I saved this for last because its instrumental and foundational to everything else.  Taking Stock and Making a Plan are very concrete things you can do to start taking back control over your life.

I once heard someone say, “Its not hard to be poor.  It's hard going from poor to being rich, then going back to being poor.”  Once you have had a taste of what life is like with financial freedom, I can certainly understand how that would be hard.

The good news, if you made it once, the second time around will be that much easier.  Of course, none of that can start until you are in the right state of mind.

REMEMBER: Any self talk that doesn't take responsibility is defeating and will only slow things down to getting your life back on track.  Read your daily life mantras that pull you forward towards your goals.

Its when you get knocked down and how you handle it that will really show what you are made of.  Because we all fail and some of us fail greatly… but the bigger goal the bigger the chance of success and the best chances of learning.

Get in the right mindset by focusing on these 3 things:


Learn from mistakes and how you can do better next time around.  We all make them so there is no reason to be embarrassed or ashamed.  Once you are done with a good cry (because sometimes we just need that), put on your big girl pants and dry your face cause we have work to do.

Let Go

Let go of what you can't control and focus on what you can.  Let go of self defeating talk.  Just let go.  This can be hard especially if the wound is fresh, but eventually you will find that if you keep feeding energy to things you cant control, it is a complete waste of time.  And, time, my friends, is too precious to waste on those unworthy in your lives.


Live a happy life.  Don't waste time being angry at yourself or someone else.  Forgive them, not for their sake but for your own.  Don't believe me?  Consider these 3 facts about anger:

1. Anger is like a heavy weight being carried around and slows your down.

2. Anger is also detrimental to your health showing a direct coloration to heart disease, high blood pressure, diabetes and even obesity.  Is anything worth potentially adding that to your life?

3. Anger is the best way for someone else to control you and your actions.  Don't give someone who doesn't care about your well being that kind of power over you.

Forgiveness doesn't mean you trust that person again.  Forgiving and forgetting are two very different things after all.  To forgive means to let go for your own sake.  To forget all that happened only leaves you open to being hurt or disappointed again.

Lastly, the best revenge is a truly happy life.  Focus on what you can control and leave the rest behind, work the plan, plan the work.

Thanks for the emails.  Keep them coming.  I love hearing from you.  🙂

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