Maryland Bar Bulletin
Publications : Bar Bulletin : August 2006

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MSBA Lawyer Assistance Program

Facing Your Financial Problems

After yet another night of tossing and turning, John notices the first faint light of dawn streaking through the curtains. It is nearly morning now, and yet another night has passed without deep sleep. John crawls out of bed and stumbles to the shower. As usual, John is agonizing over his financial problems. He wonders whether his mind, body and soul will have the stamina to get him through yet another day.

John is a sole-practitioner and, at age 49, he finds himself over his head in debt. Moreover, life goes on, and everyday needs must be met. The reality of the situation is that John owes money that he cannot pay, including (but not limited to) credit card bills, mortgage payments, car payments, utilities, student loans, etc. In fact, John – normally a professional's professional – is even parking his car a few blocks away from home because he has missed a few car payments. Additionally, in order to deal with the bill-collectors, John has made sure every single phone, both at the office and at home, has Caller I.D. John cannot believe his financial predicament. He describes himself as a frugal lawyer. However, after a number of harsh life-events, John finds himself going deeper and deeper into a red financial hole. "My bills are sticking to me like Velcro," as he puts it. "The pawn shop is becoming my shop of choice!" Accordingly, the additional pressure, anxiety and tension to an already-stressful lifestyle are straining every aspect of John's life.

The Problem
Money worries can create enormous stress, particularly when they threaten the way you live, your home, your business and even your family. Financial difficulties can be created by events beyond our control, such as low income, low cash-flow, job loss, litigation, health, overspending and even turbulent world affairs.

Asked which emotions they most often associated with money, 71 percent of the 20,000 people responding to a survey conducted by Psychology Today listed anxiety. Of the 20,000 respondents, 52 percent listed depression and another 51 percent listed anger. (The survey allowed for more than one response.) Those most stressed by money – and they were not necessarily jobless – complained of more fatigue, insomnia, headaches and other stress-related complaints.

According to a new survey commissioned by Family Credit Counseling Service of Rockford, Illinois, researchers are beginning to calculate precisely how much damage is being done. The survey – performed in November by Impulse Research Corporation of Los Angeles – queried 1,590 consumers with credit-card debts. Nearly 25 percent had debts exceeding $10,000. The survey had a margin of error of 2.5 percentage points. More than 75 percent of people with credit-card debt have experienced some type of physical symptom that the attribute to the financial strain. Headaches, inability to concentrate and nausea were the most common symptoms. Furthermore, nearly 35 percent of debtors reported trouble concentrating at work, and 17 percent acknowledged spending time at work dealing with financial troubles. Some credit-repair clients even threaten suicide.

The Solution
Job loss, low salary, life-events – whatever the cause, economic upheaval is impacting many, even within our own legal community. However, digging out of debt is not an insurmountable challenge. The solution begins with an attitude adjustment and a declaration of personal revolution.

Revolutions are transformations that are undertaken in small steps, resulting in a dramatic change. Similarly, real personal change requires a plan, along with persistence, focus, commitment and vision. By dealing with financial problems head-on, your standing with creditors will improve while you relieve the stress of worrying.

Some Tips for Working through the Stress
The way that you cope with financial stress is as important as how you deal with the payment of creditors.

  • Take responsibility. You are responsible for your own thoughts, actions, feelings, decisions and their consequences. Unless you take responsibility, you will not strive to change what can be changed. Rather, you will remain in a cycle of blaming other people or life-events for the way you think and feel. You are not a victim.
  • Acceptance. Accept that you cannot control every situation and learn to be flexible in your thinking. We all have needs (even lawyers), and when these become too demanding, we can burn-out.
  • Manage worry. When it comes to managing worry, the famous Serenity Prayer gets it right: "[A]ccept the things you cannot change, the courage to change the things you can, and the wisdom to know the difference."
  • Don't wallow. Rather than feeling sorry for yourself and focusing on what you don't have, focus on what you do.
  • Turn it over. Spirituality through prayer and/or meditation can soothe the mind and calm the soul.
  • Eat well. Eat a well-balanced diet and limit sugar.
  • Get sufficient rest. Rest is imperative to maintain health and stamina.
  • Move a muscle; change a mood. Try to incorporate moderate exercise into each day to boost your energy level and improve your mood.
  • Relax. Make time for relaxation. Listen to soothing music, play with your pet; read a novel, watch a comedy and laugh!
  • Avoid tobacco, alcohol and drugs.
  • Ask for assistance. If you are having trouble coping on your own, help is available from many sources. Professional assistance from a counselor or lawyer assistance professional is often necessary. This does not imply weakness. It simply indicates that the particular situation is just too overwhelming to handle on your own and that you need coaching to get through it!

Some Tips on Working through the Debts

  • Get help. See what services are out there to assist you.
  • Prioritize. Decide what things constitute essentials and what are extra. This will allow you to budget for the important things such as health costs, mortgage/rent, utilities and food; while delaying or eliminating non-essential items.
  • Communicate and negotiate for yourself. Rather than dodging your collector's calls – negotiate a lower interest rate. Keep records of all communications.
  • Don't be afraid to downsize. Someone will do it eventually, and it may as well be you. Your chattels may be worth cash.
  • Consider a part-time job. This allows for additional cash-flow, and there are many individuals working part-time jobs just to get out and meet people.
  • Use cash instead of credit. Research has found that people who pay with cash instead of plastic spend 12 – 18 percent less whenever they shop.
  • Bankruptcy may be the last solution; but do not represent yourself. Moreover, it is wise to check with your state's ethics and rules of professional conduct prior to doing so.

Our attorney John decided to get a handle on his situation. Furthermore, he also learned to take one day – as well as one thing – at a time. There may still be many changes that he has yet to face, but it is not beneficial to try to resolve all problems at once. Solving one problem at a time gives a sense of control over a situation.

Likewise important, John kept occupied, active and involved. Assisting (on a limited basis) in the community, the local or state bar associations or church projects kept him positive. By so doing, John not only helped others but found these activities helped him build personal feelings of self-worth. For John, the most valuable life/business lessons came from facing up to the challenges while planning and implementing his own personal revolution against debt.

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Publications : Bar Bulletin: August 2006

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