Second Time Around: Repairing a Damaged Financial Past

Financial mistakes can prove costly and the debt burden hard to bear, but there are ways to draw a line, sort things out and start over with a better financial plan. Here’s a rundown on the typical financial mistakes people make and some ideas on how to put things right.  

Common Financial Mistakes

Your financial mistakes may have come from the best of intentions but now you are suffering from their results. Here are some of the most common financial errors:

  • Frivolous spending
  • Not paying off credit
  • Spending too much on your home
  • Buying a car you can’t afford
  • Living paycheck to paycheck

Check Your Credit

The first step to cleaning up your credit is to get a credit report so you know exactly where you stand. You can get one from one of the three main credit bureaus: TransUnion, Experian or Equifax. Financial experts recommend that you get one from each of the bureaus because the reports may contain different data, which could affect your credit scores. Make sure all of them area accurate. Learn here how to access your credit score for free every year.

Debt Settlement Programs

If you haven’t already, you may want to check out Debt Settlement Programs (DSP). If you owe a large amount of money to a creditor and you want to figure out how you can pay it back, a DSP will help you. If you can show that you have no way of paying back the money, and you are not paying money to other lenders, a Debt Settlement Agency may help to handle negotiations for you. They typically take a percentage of the amount that you settle for, which can be a lot of money. However, even with the fees it’s still possible to save a significant amount of money.

Be Patient

You won’t clear up your bad debt overnight, so be prepared for a wait. Some financial negative marks, such as foreclosures or tax liens, can stay on your credit report for up to seven years. The steps you take to re-build your credit will vary depending on the type and amount of debt you have accrued. But if you pinpoint the main credit score killers and work hard to pay off your debts, you will get there in the end.  


Even though you may be very stressed about your current financial situation and your inability to pay your debts, the worst thing you can do is nothing. Remaining silent will only increase your stress and put more pressure on your family. Don’t wait for a miracle to happen. Take action now before your creditors start legal proceedings against you. Don’t be afraid to find a debt counselor, they will guide you through a simple, step-by-step application process and they will be with you every step of the way to ensure that you are receiving the help you needed and that your rights as a consumer are not being abused.