When You're in the Red

It's been a time of big expenses for us, as we've paid for our property taxes, income taxes (we owed some this year), plane tickets and more. That means we'll spend a couple of months "in the red" - that is, spending more than we're bringing in. And even though we have the money in savings (and some of the expenses were actually budgeted for), spending more than we make causes me great discomfort and even a little anxiety.


A big part of that is my personal lack of income - as a blogger, I don't make anything close to what I used to make as a lawyer. But there's not a whole lot I can do about that now. So ... here are some tips for coping psychologically when your expenses suddenly outweigh your income:

Stem the tide - Spending can be like a break in the dam. First there's a slow trickle, but the pressure builds up and boom! - there's a big hole in the wall. The trick is to patch the dam before the hole gets too big. You can do that by questioning every expense, and asking yourself if it needs to be made right away, or if it can wait for a while.

Cut back where you can - Things like eating out, gourmet groceries, a night out at the movies, and so on can almost always be put on hold while you get your finances back on track. For me personally, this often means limiting shopping solely to the grocery store for perishables only, and not stocking up on something I don't need immediately, even if it's a good price.

Bring in some extra income - This is one of those times when doing little things to bring in extra income can have a bigger impact on your mental state than your actual bottom line. You can sell some stuff on Amazon, eBay or Craigslist, have a yard sale, or take surveys (I like Pinecone Research). And that's just a few ideas - there are many other ways to bring in a little money.

Declutter - It never ceases to amaze me how much better I feel about everything by decluttering a room, closet or other area. In this particular situation, it's a good reminder of how much I have, how little I need, and that everything is going to work out just fine.

Maintain perspective - Sometimes spending money makes sense, whether it's paying the taxes to avoid paying even more in the form of a penalty, or going on a rare trip to see family. The purpose of saving money is precisely so that it's there when you need it - at times like this. Keeping that in mind helps to relieve the anxiety of seeing the balance in your bank account go down!