“Money is a terrible master but an excellent servant.” ~P.T. Barnum~
Phineas Taylor (P.T.) Barnum—American founder of Barnum & Bailey Circus—was renowned for being a showman who knew how to make a buck, which is how he became one of America’s first millionaires. His quote that “Money is a terrible master but an excellent servant”, sums up the importance of making your money work for you.
Barnum points out that, if all you do is work for money, it essentially becomes your master. On the other hand, if you put your money to work paying bills and for life’s necessities, acquiring assets and other investments, etc., it serves you. So strive to be the master of your destiny—financially, anyway—by ensuring you’re the master of your money.
How to Rectify Past Financial Sins
Everyone makes mistakes, especially when it comes to money. Find out how you can set yourself on a better financial path by atoning for some of your worst money missteps.
Nobody’s perfect — especially when it comes to managing money. While you may try to keep track of your funds, budget wisely and spend well now, you may have made some serious money mistakes when you were younger. Since having money doesn’t exactly come with an owner’s manual, you may have had lackadaisical spending ways or gone wild with credit before you smartened up and started taking money seriously. Still, those past sins can come back to haunt you in the form of creditors or less-than-impressive credit scores. Your best bet is to face money issues head-on and atone for those missteps so you can move forward with better habits.
Open up
When dealing with past financial mistakes, it’s easy to turn a blind eye and hope that they simply go away. But when you owe money or default on loans, not only are those creditors still looking to get paid, it can affect your long-term ability to secure credit and enjoy future financial freedom. Instead, gather up all of your statements and go through them with a fine-tooth comb to give yourself a general picture of which mistakes you’ve made but can be easily rectified with dedicated work.
Make a plan
Once you know where you stand money-wise, it’s time to create a plan to pay back creditors, and remove any inaccurate information on your credit report. This may require some leg work on your part, so plan on working with creditors on settlement deals, checking your credit report and contacting your creditors or credit reporting agencies to remove inaccuracies that you may have found. Consider your plan like you would a work project: focus, then put your energy into accomplishing it.
Start small
No one is saying that you need to put all of your savings toward paying off an old debt to get rid of it. In fact, starting with smaller debts — an old credit card or small tax bill, for instance – helps you get rid of some of your smaller mistakes, and can also help provide a sense of accomplishment. Start with the most manageable issues. That way, you’ll have more of a leg to stand on when negotiating with larger creditors.
Keep it rolling
Once you’ve made headway on some of your smaller money mistakes, it’s time to get serious. Keep up the good work by taking a look at your current budget and cutting back spending to free up money for payment of other debts, or making settlement agreements with other creditors. When you have cash in hand, creditors may be more willing to settle, but you’ll need to be prepared to act immediately. While it might mean a few months of leaner living, having a clear conscience and rectifying the mistakes of the past can help you move forward with your future financial goals.
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