Theoretical Conversation Between a Financial Planner/Counselor and a Debtor

Financial Counselor:
So, you are here today because you would like assistance and a plan to help you get out of 100K credit card debt?

Client:
Yes, can you help me with that?

Financial Counselor:
Sure, I can do that! We can set up a budget for you which you can follow every day. It may feel like a drastic change to how you have been living and what you have been spending up to this point, but it will be necessary in order to slowly work your way out of this debt, and to get you into financial health.

Client:
OK, let's do it!

Week One:
Financial Counselor:
So, how did you week one go?

Client:
Well, it went OK but I'm really ashamed that I even need to be on this budget, and it's just really really hard, harder than I thought it would be.

Financial Counselor:
What do you mean, you are ashamed to be on the budget?

Client:
Every time I think about the fact I have to be on this budget I get sad, and I get mad at myself for having gotten into 100K of credit card debt.

Financial Counselor:
OK, yes, sometimes when we see the result of our prior actions in the cold hard light of day, and know that it doesn't have to be that way, we can feel somewhat ashamed that we needed to see a financial planner or debt counselor, I understand that. But we now have a solution for you to begin reducing that debt in a very systematic way, with a program that is guaranteed to work if you follow it exactly. Can you do that this week?

Client:
Sure, I think I can, but it is really hard.

Week Two:
Financial Counselor:
So, how did it go for week two?

Client:
Well, it was tough, I struggled, and I ended up buying a few things that weren't on my budget, things I wanted and at the time they made sense for me to buy.

Financial Counselor:
OK, but didn't we work out in your budget the things you absolutely needed, we decided what those were, and you agreed that the budget covered all of your basic expenses?

Client:
Yes, I know, but I really wanted this thing and resented the fact I was on a budget, got mad at myself for being 100K in debt and needing a budget in the first place, so I bought it.

Financial Counselor:
OK, well you know that this budget will only work if you follow it, and if you don't this is just a theoretical exercise until you put action to it, right?

Client:
Yes. I'll do better this week. I promise. I know I can do this.

Week Three
Financial Counselor:
So, how did week three go?

Client:
I did really well for the first few days, but then I saw something I really wanted and I was out with my other friends who were all buying the same thing. I didn't want to admit to them I was on a budget, and I didn't want to not feel like I was included, so I went ahead and bought it too. The next night we went to a restaurant I knew I couldn't afford, I knew it wasn't in my budget, but I felt ashamed that I couldn't go there with them so I went anyway and put it on my credit card. I didn't want them to judge me or think I couldn't handle my money, and I really didn't want them to know I was trying to live within my means.

Financial Counselor:
The thing I want to relay to you is that you CAN live a financially free life SOON provided you begin to follow this budget NOW. Every day you don't follow this budget you are remaining in the same amount, or more, of debt that you came to me with. Do you WANT to live within your means and be financially healthy?

Client:
YES! I do! But I'm ashamed I have to even be ON a budget, and I can't shake that feeling, it makes me feel BAD to be on a budget. But I'll do better this week.

Week Four
Financial Counselor:
(Client skips meeting)

Week Five
Financial Counselor:
So, how have the last couple weeks been? How is your budget going?

Client:
Well, not good. I just can't seem to get over the fact that I have to be on a budget. So, as they day goes on, I am tempted to buy this or that, and part of me tries to stay strong, but the other part of me goes ahead and buys it, and then I feel really guilty and bad that I didn't follow my budget.

Financial Counselor:
I have a question for you, does this budget feel a bit restrictive or drastic right now because you are comparing it with the way you WERE living which got you into 100K of credit card debt?

Client:
Yes, and I'm ashamed to even have to be ON the budget. I do want the debt gone, though, it is really uncomfortable to get the bills every month and wonder how I am going to pay for them and wonder WHEN this debt is going to be gone. I wish someone would just take it away from me and I could start out with a clean slate.

Financial Counselor:
So you desire to have the BENEFITS of having your debt wiped clean but are ASHAMED of having to do the work in order to get there?

Client:
Yes, that is exactly what I feel. I know I NEED to be on this budget, but I also want to keep living the way I was living before. And the sooner I can be DONE with this budget the better.

Financial Counselor:
What if it is only in the PROCESS of consistently following the budget and reducing your debt that you learn the skills necessary to stay out of debt and live financially free? If someone just came and took the debt from you, paid it for you, and you had a clean slate, you would be back in here next year with another 100K of credit card debt.

Client:
That's a good point. But every time I deviate from my budget even a little bit, I decide "What the Heck" and I buy the other 10 things I've been wanting for awhile. It seems like all this budget is doing is making me crazy and getting me more into debt.

Financial Counselor:
Well, actually it is YOU that is doing that BECAUSE you aren't taking action and following the budget.

Client:
You mean the budget isn't to blame?

Financial Counselor:
No. The BUDGET is just a structured system, a way to organize your resources so that daily you are not spending more than you take in, and when we are trying to reduce your 100K credit card debt we are actually structuring it so that you pay down a little bit of your debt every week. We keep doing this until your debt is paid, and it would be the same system whether you owed $100, $10,000, or 100,000. Once the debt is paid you will have more freedom in what you choose to spend your discretionary income one, but right now that is all going to reducing your debt. However, you will always be living with the structure of a budget from here on.

Client:
WOW. So the budget is actually a tool to bring structured spending into my life in order to get what I really want, which is financial freedom? It isn't a punishment?

Financial Counselor:
Nope. It is not a punishment at all. It is actually a ticket to freedom.

END OF DIALOGUE.

I wrote out this dialog in order to compare concepts our Optimal Wellbeing Program to another category, having debt.

Our accumulation of adipose tissue is nothing more than us having lived "beyond our means" in terms of energy consumption thus far in our lives.

It is a balance sheet, a ledger of sorts, of how we have managed our energy. It is no more shameful to be 100 pounds overweight than it is to be 100K in credit card debt, it is simply the consequences of how we have lived our lives up until NOW.

To say "I've always been 100K in credit card debt, how can I change now, and if I do change won't I just get back into credit card debt?" is not logical to say, because our FUTURE selves will be a reflection of what we do from TODAY on.

If you decide to be healthy in a month, 6 months, or a year, yes there is a process to go through, there are tools, our Optimal Weight 5&1 Plan is our "Energy Budget" of sorts.

But we need to follow it for it to have any impact in a week, a month, six months and a year.

Living beyond our means with food has led to an energy imbalance, and we have stored away energy to varying degrees for our bodies to use "at a later time" but that "later time" never comes because we never create the conditions physically for our bodies to need to use that energy up.

We keep making deposits into the energy bank, but not using all of it, and our bodies say "thanks, I'll store that as fat to use later." Our program is the tool that says "OK, here we go! Time to start using up that energy from here on out!"

Our program isn't a punishment, neither is it indicative of a failure on our part. It is simply a tool for those of us who may have never been taught how to balance our checkbook in terms of health to LEARN how to balance that checkbook and begin accomplishing the things we have thus far only dreamed of but somehow even the dreaming made us feel bad because for some reason we thought we could not do it.

We CAN do it. But it is a choice to follow our "budget" daily. Sometimes that choice is hard. Sometimes it means we can't do everything we want to do, just like someone who is paying off a 100K credit card bill may feel like they can't do everything they want to do initially.

But in the PROCESS of following the budget and seeing the results, something magical happens. I've heard it both in our program and in Dave Ramsey's "Financial Peace University" and that is that the PROCESS becomes FUN! Once people have adjusted their expectations and made getting out of debt their primary goal, it becomes EXCITING to accomplish that, little by little, every day! Every spending decision they say "no" to becomes a victory, becomes FUN, and is a reminder that they are getting financially healthy. Once they ARE out of debt and have become financially free their whole mindset has CHANGED! They don't WANT to go out and frivolously buy something they don't need. They CONTINUE to make wise decisions because in the process of paying off their debt, they developed the habit of healthy spending which will ensure they don't fall into the debt trap again.

Our program is much the same. But the above is descriptive of the PROCESS, the HOW, and what is REALLY important is the WHY behind the HOW.

What was lacking in the above conversations was any question posed by the financial counselor of "Why do you want to be financially free?'

I'll blog more on THIS concept next time. THIS blog was simply to highlight the similarities of how feeling ashamed of being on our program makes about as much sense as being ashamed of being on a budget.

The Optimal Weight 5&1 Program IS our "energy budget," which helps us attain energy equilibrium by creating the conditions where our body USES all that energy it has been saving for a rainy day. Once we've attained "energy equilibrium" also known as a healthy weight, we then us the "Transition Budget" to get us to the Maintenance Budget" which will allow us some structure in maintaining our "energy equilibrium". It isn't about diet and deprivation. It is about attaining and maintaining optimal health. The principles are much like someone being recommended a budget to attain financial health, which necessarily will include getting out of credit card debt. First you work on re-paying what you owe, then you work on living within your means moving forward. Same principle dynamically.