Message from Sylvia

 

First let me encourage you. Being broke won’t last forever, being poor is a state of mind.

 

I want to tell you some of the reasons people go broke and what I have learned being a trained counsellor, life coach, budget advisor and mother of two financially responsible young adults. The word broke to me means financially sick – stressed about money – money in control of you instead of you controlling it. It may mean something else to you.

 

After completing a Diploma in Counselling, I was employed as a Life Coach with a community organisation. The coaching I did was conducted in the students’ homes over a twelve month period. One of the five areas that my students looked at as part of the course was finance. What I noticed was that it wasn’t necessarily the amount of money that was coming into a home as to why people were in debt and stressed. Some people managed quite well on a low income whereas some people who were earning large incomes had just as much debt and were just as stressed as those on lower incomes. Many times the bigger the salary, the bigger the debt, the bigger the stress. Approximately 90% of my students’ financial dreams/goals were simply to be debt free.

 

I noticed that people lacked basic financial literacy skills (how money works). My students did not understand compound interest for example and had no idea of the real cost and long term effects of borrowing money for stuff such as a car, stereo and TV which depreciated as soon as it was bought.

 

I was told many sad stories, especially to do with cars. Many people naively thought when they were given a loan for a car, that they must be able to make the repayments otherwise they would not have been given the loan. One couple were unable to meet the repayments of their car so it was repossessed. The car was sold for $2,000.00 by the finance company which left a debt of $8,000 still to be paid. So now they had no car but still $8,000 to pay and were being hounded by debt collectors.

 

When my job as a Life Coach was made redundant I wanted to help people with their finances so I became a budget advisor. Notice I didn’t say I was made redundant like many people do. My job was made redundant, not me!

 

Being a budget advisor opened up my eyes to the world of people in a mess financially and this is what fuelled my passion to be able to do something about it. My clients would share their lives with me at a very intimate level. Many people had made poor choices from a lack of knowledge. More than once I met women who had moved in with their boyfriend. They agreed to take a loan in their own names or go guarantor for something that their boyfriend wanted such as a stereo or computer. When their boyfriend moved out after an argument they were often stuck paying for something that they didn’t want in the first place. One way you can stop your kids and yourselves from going broke is not to go guarantor for anyone.

 

Relationships can breakdown in families due to financial pressures and misunderstanding about money due to different belief system people hold about money. The book “The Four Laws of Debt Free Prosperity” indicates that money pressures contribute to 89% of all divorces and relationship breakdowns. From my experience I think that is a true statistic.

 

Through experience I have found that no matter how much time I spent with some people trying to help them to manage their money and get out of debt, they just seemed to go around and around in circles. This is because they had ingrained beliefs about money or people with or without a lot of money at a subconscious level.

 

This discovery has tied in with my counselling training. Once you understand how beliefs work in your life and the lives of others you love you can understand why you do what you do and why others do what they do with regards to money.

 

In Step two – Transform your thinking - we go into how beliefs are formed about money and everything else in your life and how those beliefs show up in your everyday life.

 

Another thing I noticed is that people are being deceived. Advertisements for encouraging you and your children to take on consumer debt (items which depreciate as soon as they are bought) convey the feeling that you are making the right decision to buy now and pay later. 

 

Nothing could be further from the truth because debt can cause you to worry, have health problems, cause relationship problems, and for some people commit crime. Consumer debt can cause you to become a modern day slave. A slave to your lender. 

 

Consumer debt should be conveyed that when you take it on, all of a sudden you will realize you are in a swamp full of debt leeches who are sucking the financial life blood out of you and your family. 

 

These leeches also seem to have the ability to crawl from one generation to another after they have finished sucking the life blood from you. They need to find new fresh blood – so they crawl and latch on to your children, and grandchildren. Unless you take action and kill those blood suckers once and for all your short term gain will turn into a long time pain.

 

Don’t get me wrong, all debt isn’t bad. There is such a thing as “smart debt” and “dumb debt”.

 

Access to easy credit has caused this generations understanding of “needs” and “wants” to be confused. 

 

I have been working with friends and clients and once they uncover myths and beliefs they have about money they start making huge progress in unravelling their financial mess. It doesn’t happen overnight – but it does happen.