Mar 20th, 2009
“It’ll All Work Out Somehow” is NOT a Financial Plan!
One of my friends who I meet for meals from time to time likes to tell me a lot about her financial problems (she is apparently oblivious to this blog), including how she got into her current adjustable rate mortgage with no money down, how the apartment has no equity, and how she’s having difficulty with her credit cards or paying her other bills. What’s amazing to me is not that she’s not looking for help or advice (I can assist with that), but instead, the conversation always ends with:
“But don’t worry, Ryan, it’ll all work out somehow.”
Uh, how?
Gang, “it’ll all work out somehow,” is NOT a financial plan! Realistically, there are only a handful of things you can do to change your financial situation: spend less, earn more, or do both. But, as the old time management tenet goes (and it applies equally to your finances), failing to plan is planning to fail. Figure out your baseline. Set goals. Make a budget. Spend less. Take a part time job. Refinance your mortgage. But do something. Don’t just believe it’ll all work out somehow–make it work out somehow!
