Broke and Without Hope? 7 Financial Steps You Can Take When You’re Feeling Stuck

A little over eight years ago, I was homeless and living in a motel. I felt hopeless and undoubtedly financially strapped. Over time, I was able to make changes that helped me get to where I am today. You can do it too! Take these seven financial steps and you can break free from the cycle of despair.

1. Take a Step Back and Assess Your Situation

The first step is to stop for a moment and take stock of where you are. Track all your income, expenses, debts, and savings. This may sound like a daunting task, but it’s important to get a clear picture of your finances. Write it down or use apps to make sure nothing is overlooked. Once you have the numbers in front of you, it will be easier to see where you need to make changes. This honest assessment is your foundation for all future steps.

2. Create a Budget That Works for You

Creating a budget is one of the best ways to manage your money. Start with a simple definition of essential and non-essential expenses. It’s tempting to skip this step, but a budget will help you prioritize needs over wants and limit overspending. There are many budgeting tools such as the QuickBooks budgeting tool or free apps to help you track expenses. Don’t forget to set aside emergency savings, even if it’s a small amount. Managing money well can give you a sense of accomplishment and help you regain confidence.

3. Cut Nonessential Expenses

Start cutting back on the non-essentials that eat up your money. Small sacrifices can make a big difference, like cutting back on subscription services, eating less, or skipping that expensive coffee every day. Try to think creatively—what luxuries can you live without right now? The goal is not to make big, painful cuts, but to eliminate unnecessary spending that could lead to your savings or debt payments. If you need some inspiration, check out budget tips for people living on a tight budget. Every little thing adds up over time.

4. Build an Emergency Fund

Building an emergency fund is a game changer when you’re stuck financially. Start with small, achievable goals, like saving $500, and build up gradually. This fund will act as your safety net against unexpected expenses and prevent you from relying on credit cards or loans in a crisis. If you can’t afford a large sum right now, automatically switch to smaller weekly or monthly contributions to make saving painless. Focus on short-term goals first, then aim for at least three to six months’ worth of expenses. This step can give you a sense of security, even in difficult financial times.

5. Take Advantage of Free Financial Services

Don’t underestimate the power of free resources available to you. Financial counseling services, free budgeting workshops, and online courses can provide guidance at no cost. Check out local community resources or trusted websites that offer free debt management advice. Even free money management and credit score monitoring apps can help you stay on top of your financial health. Remember, asking for help doesn’t mean failure—it means you’re doing something. Start by accessing resources locally or online.

6. Focus on Small Successes and Set Achievable Goals

If you’re feeling overwhelmed, focusing on small wins can help you build momentum. Instead of stressing about your entire financial situation, break it down into smaller, manageable goals. For example, aim to pay off one small debt, set up an automatic savings plan, or pay off your credit card in full. Celebrate those wins to boost your confidence. Small steps can lead to big changes, and each goal you meet is a step forward. This will help you stay motivated and maintain a positive mindset.

Take Control of Your Future, One Step at a Time

Feeling stuck is bad. You may feel like there is no real way forward, but I can promise you that there is. No matter what you’re facing, you can take these small, intentional steps to improve your health. Remember, don’t be afraid to ask for help or reach out for resources! Your financial situation isn’t permanent, but things won’t change overnight. You may need help to get there.

Have you ever felt stuck, hopeless?

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