Yesterday evening, after a string of setbacks and key employee resignations (yes, these things happen), I thought of my responses and strategies.
For a while, I thought, "Wouldn't it be nice to just put everything on hold for a year." Then I figured how I could finance this appealing diversion, and began imagining how I would live and spend the borrowed money to reset my emotional clock and priorities.
My wife (thankfully I am married to someone who is rational and wise, as well as beautiful) quickly put me into my place. She reminded me forcefully and effectively that debt rarely solves problems long-term, and if I want to take the break, I will have to deplete my savings. I can do this, of course, but should I?
These choices reflect the difficult decisions many people encounter; in exchange for short term or immediate gratification, they pull out their credit card or refinance their home and for a while live the good life. Then everything crumbles and the debt, if it is a problem originally, just gets worse.
Fortunately, I've followed my own advice to date in this blog, separating business debt from personal obligations (which are minimal) and this has given me a degree of security that people living on the financial edge don't enjoy.
But I admit that, for a while yesterday evening, I was tempted to break my own rules. Not everyone has the will or ability to defer gratification, of course.
Then, what is the right way for me to "find my break", if I want to take it?
These answers from common-sense business models apply:
- I can reduce my expenses and fixed costs, including, if necessary, my salary, to balance the reduced income if I am not actively engaged in day-to-day work. This may mean giving up some of the treats and pleasures of life, and being frugal about my personal budget.
- I can drain my savings. Hardly wise, but if I really need the break, I can take the money from retirement funds and feel the emotional pain of every dollar I withdraw. This will keep me firmly focused on restoring financial equilibrium and avoid the false feeling that "everything is normal" when debt is increased to maintain comfort or purchase pleasurable things.
- I can improve the business income from current activities. Obviously a good idea, and one of the best ways to do this is to find and encourage people to buy more of what we have to sell.
- I can develop new streams of income. Probably the most satisfying answer, because the additional revenue provides more security and of course allows more freedom. How? Some ideas are forming at the back of my mind (which of course require little if no financial investment).