If you clicked this link hoping to read some steamy cowboy cash secrets; we’re sorry to disappoint you. We’re talking about the other kind of ‘brokeback’: the kind where you break your back slaving at a job and still find yourself broke on the 15th of every month.
There are many reasons you could be broke this month (or for the past few/coming months). Perhaps you had a medical emergency; a stalled lemon of a car or maybe you did some overzealous shopping during the mega sale; hey, we’re not here to judge you. There may also be the possibility that your broke situation may continue a little longer than just a month. It could be a suddenly increased rental or an additional dependent you didn’t foresee. Again, life is filled with the unexpected and there’s really no sense crying over spilt money.
It doesn’t matter how you got here - let us help you get out.
For Short Term Shortfalls
If it is just a one-off emergency or a single lapse of self-control at the malls which landed you in this situation; take heart that the following measures will be temporary and sooner rather than later you should (unless another mishap has landed you back at one: at which point, rinse and repeat boys and girls) find yourself back in monetary good health.
Here are some of the tried-and-true measures of the broke everywhere when budgeting.
1. You still need a budget. Sorry, we know the sum you have in your pocket may at present look pathetic on paper and the last thing you want to do is mess up your glorious excel sheet of hearty, perfectly rounded numerals with something that looks like it came out of a standard three pupil’s 555 allowance notebook; but you still must. That’s why the title is brokeback budgeting and not... er brokeback avoidance or something like that. Why do you still need a budget?
As broke as you are, you need to know exactly how much you have to your name so you can prioritise accordingly. Pen it down: Draw up the good old list of what you have coming in and what needs to go out. Once you’ve done that – we can see the deficit and remedy it!
2. Identify how short you are (money we mean. Your gravity centre isn’t as important to budgeting as it is to dating). As painful as the picking of a scab: you must now calculate how short you actually are to meeting all your monthly bills and expenditure. RM500? RM1,000? Don’t be afraid of the figure you come up with; knowing is better than not to deal with the situation at hand.
3. Start cutting out payable items. Yes, you read right. This isn’t a permanent solution, mind and you should repay all your bills in full when you can but right now, desperate times call for desperate measures. Many bills such as utilities, phone and internet can be accumulated for up to three months without your service being terminated, so see if you can stave these off for a month.
Although interest rates are high, you can also opt to skip your credit card payments for a month if necessary. WARNING! Some credit cards will then require you to pay twice the minimum payment the following month so be sure to allocate enough for that. Also, take note of the high charges involved in delayed credit card payments and don’t make a habit of this!
Depending on how broke you are, there are usually only 3 non-negotiable items in your monthly spend list: food, transport to work and rental/housing. You need these three to survive; the rest can wait a month.
4. So broke it hurts. So you know what the non-negotiable items are; what if you’re shortfall is so serious that you can’t even meet these 3? Don’t panic! Call your landlord/bank! Explain the situation and ask if you could pay half or defer payment for a little while. If you aren’t making a habit of this – there is a good chance they may cut you some slack.
5. Put in the overtime. Can’t cut anymore but still falling short? Time for some additional work! Could you take on quick part-time or freelance jobs to plug the gaps? Perhaps you could take on additional tasks at work for overtime pay. If none of these are available to you; consider selling something. The online marketplace is a great way to unload items you no longer use for extra cash. It’s tedious and time consuming but if you really need the money – it’s worth a shot!
6. Beg, borrow but please don’t steal. Tried a personal loan from a bank (please no ah longs!) or even from a close friend? The notion of borrowing isn’t pleasant but if all else fails, it’s an option.
7. Budget for coming months. Why do you need to do this? Your commitment avoidance this month will definitely end up hurting your future cash flow. To know just how much, it’s a useful move to budget now for a few months in future to see how long this one month of lack is going to affect you.
For Long-Term Lacks
Sometimes, being broke is a life-long love affair. Well, maybe not quite that long. But what if your situation is caused by something a little more long-lasting like an increased rental or added insurance payments for an elderly relative/parent? It’s unlikely we can march up to our bosses and demand a raise – we’ll have to meet the shortfall somehow.
Here’s the step-programme in such a situation.
1. Again, budget, budget, budget. Make a new budget with the new rates and calculate your shortfall.
2. Honestly analyse your situation. Is the shortfall minimal enough to be remedied by some lifestyle changes like lesser entertainment spending, cooking at home or cutting a subscription? Or is it larger? If it’s the former, you can stop reading now; cut down your latte spends and the unused subscription to Her World/CLEO/FHM. You’ll be just fine. You can find half the content online anyway (including the FHM women in bikinis! Or so we heard... ahem...).
3. Look into drastic. If you’re really struggling, perhaps it’s time for a larger overhaul. If your rental has sky-rocketed beyond your reach, consider moving, sub-letting or sharing with a friend/relative. If it’s a nursing care bill or new baby cost, look into welfare initiatives or cheaper alternatives to the care you have selected. The possibilities, depending on your predicament are actually endless but not many will be pleasant at first.
The answer may even lie in a higher paying job but all this will depend on the specifics of your financial woes. The point ultimately being made here is; don’t fear change. Sometimes, you need to embrace some drastic measures for the greater good.
4. Ask for help. Again, depending on the how dire your situation, you could either ask advice from a friend; a raise from your employer or credit restructuring from AKPK.
5. Create long-term solutions. If your issue is definitely long-term, seek a solution that is too. Borrowing money to fill the gaps now will only haunt you in future. There is nothing quite as scary as financial ruin.
Getting Back in the Saddle and Staying on
Once you’ve passed the hurdles of being broke, you may find yourself becoming complacent. But the trick in personal finance isn’t just mounting the steed but staying on when the road gets a little bumpy. Make sure once you are out of the red zone; that you make definite and concrete plans never to land there again. It’s not to say you won’t ever fall off – it’s just prevent you spending more time on the ground than riding through life.