What to Do When You Have No Money
It happens to everyone. At some point in our lives there comes a time when we just run out of money. Whether it is through no fault of our own, or because of bad financial decisions, there are very few feelings as hopeless as getting that “Insufficient Funds” message from a bank machine. (It’s even more fun when you get it when you are using a debit machine at the grocery store, just after buying a cartload of groceries)
Add mental illness to the mix, and you have a recipe for a full-blown meltdown. Running out of money really sucks, and it can make already bad problems like anxiety so much worse.
In this article, I will share a few tricks that have worked for me in the past when the moths have taken over my wallet.
1. Don’t Worry About Money
If you find yourself short of cash, don’t panic. Sit down and take some time to take a good look at your expenses and income. Often, your financial situation will not be as bad as it originally seems.
2. Spend Less
Ok, I know this is an obvious one, but it’s the single best way to start getting out of your problem. Take a very hard look at your expenditures over a 2 week period, and decide what was a “need,” and what was a “want.” Then, get rid of the “wants.” You’ll find that you will have a lot more money in your pocket for those necessary expenses once you cut back your spending.
This actually has a name; “The Latte Effect.” Basically what it means is if you get a regular $1 coffee each morning instead of a $3 latte, and you do this for a full year, you’ll save around $520.
When you do this, don’t be too harsh on cutting back your “wants” or you’ll end up cheating. Leave a couple of small treats, but definitely cut back on big unnecessary expenses.
3. Borrow
Most financial advice articles say that you should never borrow. When I read these articles. I wonder if the people who wrote them have ever had to pay bills. Sometimes there will be times when you are out of options and you have no choice but to borrow money.
If you find yourself in the situation where you have to borrow money, here are some things that you can do to make it a bit better for yourself.
First, don’t be ashamed of asking for money. I know that our culture frowns on borrowing, but it really isn’t that bad. If you have to borrow, it doesn’t mean that you are a failure or that you can’t manage your own life. Sometimes things just go wrong and you need some help.
Second, try to borrow from family if you can. I know how tough this can be, but borrowing from family is good for two reasons: 1) it’s easier to ask family members for money, and 2) if you can’t pay them back right away, they are not as likely to repossess your stuff or send you to collections.
Third, don’t be intimidated by banks. Banks are great at making it seem like they are doing you a favor by loaning you money, but remember, banks sell loans. They want to lend you their money, but they are using the intimidation factor to gain the upper hand in the relationship. Try to think of going to a bank for a loan as no different than going to the supermarket to buy a loaf of bread. You are their customer. Don’t let them try to push you around.
Fourth, avoid “easy loan” (the ones that do “payday” loans, etc) companies like the plague. These companies exist to take advantage of people who are desperate for money. They give easy credit, but they can charge extremely high interest rates and other fees.
Finally, if you do borrow, pay your debts back promptly. Don’t think of credit as an ongoing source of money; it should only be used to cover your expenses when you don’t have cash on hand.
4. Improve Your Income
Ok, this is another obvious one. However, there are two ways to have more money. One is to spend less money, and the other is to make more money.
If you find that you are constantly short of money, take a hard look at your employment situation. Have you had a raise recently? Do you feel that your work performance has been good enough that you should get one? Are there other positions in your field that pay more?
Another option is to do work on the side, either as a second job or some sort of work-at-home business.
5. Get Good Advice
Temporary financial trouble is one thing, but if you find that you are constantly running into financial problems, then it might be a good idea to get some financial advice. Call your local community services agency or even your bank and ask if they offer a course in budgeting and personal finance. Sometimes even a few simple budgeting tricks can make a huge difference in your financial situation.
6. Be Frugal
Frugality is making sure that you are putting your money to its best use. For example, when you are grocery shopping, try to buy generic brands rather than name brands, especially for basic household items such as paper towels. Or, if you own a car, see if it requires high-octane fuel, or if you can use a lower octane level. (this information is in the owner’s manual.)
Remember that being frugal is not the same as being cheap. Buy what you need, but do a bit of research to see if there is an acceptable alternative.
7. Speak to Creditors
If you have bills that are coming due, get in touch with your creditors and explain your situation. Most creditors will be very happy that you called them. (this also reflects positively on your record with them) Despite what people may think, creditors don’t like to have to collect on bills. Collection is expensive and stressful to their employees. Most creditors will respond very positively if you contact them and make arrangements to meet your obligations.
Don’t Panic
Being out of money is a very stressful experience. Nobody likes to be short of cash, and unfortunately society places a very high value on financial well-being.
Money problems are almost always temporary. They may seem impossible to solve, especially when you are already anxious because of a mental illness, but with some work and a few phone calls most money problems can be managed successfully.
And remember, getting into financial difficulty is no reflection on you as a person. We all run out of money at one time or another. There’s nothing shameful about it. If it happens to you, try not to panic and focus on solving the problem. Then, take some of the money that you have saved and treat yourself. 
iamscared responds:
Posted: April 10th, 2007 at 2:33 am →
Thanks, Scott. This post came at a very good time for me because I just cracked open a new credit card and was feeling rather guilty about it.
Dayngr responds:
Posted: April 10th, 2007 at 11:20 am →
Excellent post and fantastic advice. Well thought out! Your blog design is extremely good looking. It’s clean and concise and unique.
lee responds:
Posted: April 11th, 2007 at 11:47 am →
Hi Scott, first time I’ve visited. Excellent advice, and a really neat looking blog! I’ll be back.
Phin responds:
Posted: April 12th, 2007 at 7:03 pm →
Hey thanks for your blog. You have a lot of courage and are an inspiration. Good design too I wanted to say. Keep up the great work. Be well.
Robert Azcona responds:
Posted: April 13th, 2007 at 4:46 am →
That’s a great advice. Currently, I’m in big financial trouble and I’m relieve to know that there is hope. Excellent advice, excellent writing. Keep it up!
calc responds:
Posted: April 14th, 2007 at 3:12 am →
For #2 Spend Less: If every day then $3 - $1 = $2 x 365 days = $730
If no weekends then $2 x (365 - 52×2=104 (weekend days) = 261 days) = $525
This does not allow for holidays or vacation time, but the principle is still valid. Being without funds taught me the folly of believing hucksters with something to sell and the folly of buying things to impress people whose opinions I didn’t want, like or respect.
tisha responds:
Posted: April 14th, 2007 at 4:30 pm →
Much appreciated advice Scott!
Ask Dan and Jennifer responds:
Posted: April 17th, 2007 at 12:14 am →
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isabella mori responds:
Posted: May 20th, 2007 at 5:55 pm →
great post! i especially like the one about borrowing money and speaking to creditors. you’re right, borrowing is rarely discussed, it’s often a pretty shameful subject. and shameful subjects need to be dragged out into the light! also, speaking to creditors is soooo important. i just talked to a friend who just lost a relative, who had a very difficult life. part of that was an inability to communicate with creditors, which led to another subject you brought up: panic. speaking to creditors almost always relieves panic.
Scott Davis responds:
Posted: May 21st, 2007 at 3:37 pm →
isabella,
Speaking to creditors definitely helps relieve panic. Even though making that first call is incredibly difficult, having the knowledge that your creditors are satisfied that you are making efforts to repay them can take an incredible amount of strain off your mind.
Scott
Ken Daniels responds:
Posted: August 26th, 2007 at 8:27 pm →
Great advice , I really think the “talking with creditors” & “Approaching banks” will help alot of people
terrry baker responds:
Posted: February 23rd, 2008 at 3:30 pm →
Great Advice, but what if you have no one to borrow from? And you are 60yrs old, laid off, had a bankruptcy 5yrs ago,due to a failed business, can’t get unemployment, rent is due on the first March. We just moved here to a live on position with a company, and we paid the expense of moving from one state to another, and have no savings, in other words worked pay check to pay check. We got laid off after only 6 weeks, due to extremely mean new Supervisors……. Had to move off the property , which took all the money we had to get into a new place to live. We, don’t have the money needed for sec. dep. for the utiluty co’s. Getting a new job takes a long time, you are one out of several people filling out applications, lucky to get a call for interview, that process takes 3 to 4 weeks. There is nowhere to turn, when you have no cash at all.
All the charities, organizations, etc. you have to qualify for, and if you don’t have kids, you are out of luck. Just being broke does not qualify you for charity, you just get the run around, a bunch of phone numbers to call, and they give you more numbers to call, it’s a catch 22. With a bankruptcy now, would be employers and places to live all check your credit. You are totally in a world of trouble, no where to turn. We just need a little cash financial help till back employed, we don’t have any cash at all and can’t get any from anywhere, no gas money to get back and forth to work, now that we are getting results to be hired, affraid we will be out in the street before work starts and can make the trip back & forth. Panic desperate, need cash for rent and gas & utilities. Any ideas Terry & Bill
Scott Davis responds:
Posted: February 24th, 2008 at 11:20 pm →
Hi Terry and Bill,
Sounds like you’re having a hard time of it. I don’t really know what to suggest. Is there any way you can work something out with your landlord for the rent due Mar. 1?
Where I live, you can get grants for your utility costs from the government, have you looked into that? I don’t really know how it works in other places, but here I think it’s run by Community Services.
Another thought is temporary work for a couple of weeks…are their any temp agencies near you? It’s boring work but you could stock shelves or something for a few days, just to get together some cash to cover the short-term stuff.
Other than that, I guess all you can do is hope and pray. Maybe something, money or help, will come up. I’ve been there and I know how hard this can be. I wish you all the best.
Take care,
Scott
Donna McCrary responds:
Posted: March 9th, 2008 at 3:25 am →
My husband passed away and during the interim that he was ill, we exhausted our savings, Now I have30k in debt that I absolutely cannot pay. The income I am receiving only will take care of my rent, utilites, Insurances, prescriptions. I have let the bills go, so my credit is horrible, but I have communicated with all and explained my circumstances. I had been taking care of my 85 year old Mom, so this caused me to become unemployed and draw SS. I still am looking for a part-time position, but even with this, will not help that much. Is there any way out of this? Are any creditors willing to just write-off the debt due to hardship circumstances..
Scott Davis responds:
Posted: March 11th, 2008 at 12:43 pm →
Hi Donna,
Thanks for writing. It sounds like you’ve been having a pretty rough go of it.
I don’t know of any creditors who will write off debt due to hardship, but I’m sure that they will be willing to discuss your situation with you, especially if you are making an income (even if it is small) and you are willing to work on paying them back. Is there a credit counselling service in your community? They are usually in the yellow pages, but if you can’t find them there your bank might be able to help you. Credit counsellors can help you negotiate with your creditors and they can also help you learn about what other resources or options might be available to you.
Scott