De-stress on financial bumps

This was originally published on Monday, March 21 ,2016 in the Pacific Daily News.  Click here to subscribe to the PDN.

It is common in today’s society for people to find themselves in financial trouble.  Studies show that we do not save as much as our parents or grandparents did in the past.  Job stability is not the same as when we were growing up.  Today’s ebb and flow of unemployment and high cost of living can put a lot of financial stress on people.  When you find yourself in financial trouble take action immediately.  Here are a few steps you can take to help you start overcoming you financial troubles:

Face your troubles.  Because finances are so personal, people often link their financial troubles to failure.  We are all human and we make mistakes.  But burying your head in the sand is not going to make it go away.  The first step is to admit there is a problem.

Reevaluate your budget. Calculate how much you make and  your expenses.  Cut out the unimportant expenses like entertainment, eating out, magazine subscriptions, and even your cable bill.  Identifying these is probably the hardest part besides actually following through.  Harsh times require tough actions.  Once you are out of your financial troubles you can always enjoy the extras, in moderation of course.

Create a plan.  A plan is only good if you can follow it.  Set a timeline with specific goals.  For example, in two months, pay $1,000 on your credit card.  Keep your plan accessible and in plain sight.  It will be a reminder of what you are trying to achieve.

Stop borrowing money.  Do not obtain a loan or another credit card to start paying for your expenses.  This is part of a malicious cycle.  Although it may seem you are paying off your debt you are actually adding more debt. Your interest rates will increase as you go further in debt negatively affecting your credit score.  At this point no one will loan you money and you are stuck with multiple debts.  It is best just to stop borrowing money altogether.

Negotiate your existing terms.  It is difficult to talk to people who entrusted you to repay the money they lent you.  But most financial institutions are willing to help and create solutions that could help you.

Have a yard sale.  Look around your house.  Like most of us your house is probably filled with items that you and your family no longer use.  Go through the kids clothing and toys.  They very quickly t grow out of clothes and their tastes are constantly changing.  We tend to become attached to our personal belongings and it can be hard to get rid of.  Some of your items can be replaced later once you get out of your troubles.

More employment.  Look for part-time or a second full time job.  Today there are many options for working out of home or from a mobile office.  You can also start a small business from your hobby.  It may take you away from what you enjoy for a while but the outcome of being financially free will be well worth the time.

Track your progress.  Looking at where you started and where you are now is very motivational especially if you sacrificed and worked hard.  Keep something visual to remind you of where you stand and how far you have to go.  Don’t forget to treat yourself to something small when reaching milestones.  If it feels like work all the time, you will never stick to you plan.

Michael Camacho is president and chief executive officer of Personal Finance Center. He has more than 20 years of experience in retail banking and at financial institutions in Guam and Hawaii. If there is a topic you’d like Michael to cover, please email him at and read past columns at the Money Matters blog at


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