Know What You're Dealing With

For me, once I know that things aren't going well, my impulse is to ignore the problem since it seems easier than facing it.

When it comes to finances, though, ignorance usually only begets worse trouble. You know that thing where you look at your W2 at the end of the year and you ask, "Where did all of that GO???" Then you kind of tell yourself that you just wasted that much money and you suck and your a loser who can't control their finances? Before you berate yourself, get informed and find out just where your money goes.

Start easy. Spend a few days just pulling bills together.

Then, sit down and write down a month's of expenses.

Gas
Car Insurance
Student Loan Payment
Groceries
Rent/Mortgage
Utilities...

Add in a section for irregular expenses. Car registration, memberships, oil changes, other maintenance, etc. 

Group them however you like. Personally, during this part, I like to group them into my level of influence on the total. Rent, insurance, etc. ? I really can't do much about in the short term. Groceries, gas, I can change my habits today.

It's an eye-opening experience. While in one way, it's good to see the amount that you can change and you look at and go, "Yeah, I spent way too much money on dumb crap this month." Often, you see how much of your expenses are pretty legit and not anything to feel badly about. For me, seeing that and recognizing that I don't need to be so hard on myself makes me feel good enough to go on and take steps to do even better.                                                               

We Suck at Tackling Things That Scare Us

And a lot of the time, things that mystify us scare us.

Money and finances are among the most important things in our lives as they do affect access to safety, health, comfort, and happiness. But partially because of the importance of the matter, and largely because of the massive amounts of things to know we tend to shy away in a typical information overload paralysis fashion and a lot of people just stuff their heads in the sand and continue to make crappy decisions.

Our relationships with money are often somewhat similar to struggles with food and weight.

• Crazy, overwhelming piles of often conflicting information and advice in a deep internet vortex leading to hours and hours of research, winding up completely confused, and then saying, "Forget it." and doing nothing because you don't know which advice to take and it seems like everyone is out to scam you.
• Remember when Fat Bastard said, "I eat 'cause I'm fat and I'm fat 'cause I eat."? We do this with money sometimes. I perceive myself to be poor so I'm sad so I spend.
• To attain our goals, both require short-term sacrifice in the name of long-term gain.
• It's highly emotional and therefore a lot of our reactions are pretty irrational.
• To some extent, our appetites are just naturally different. Some people really couldn't care less about stuff while others lust after the newest, best, shiniest, and it really does occupy their thoughts. The minimalist is sometimes no more making a statement than the consumer and neither person is necessarily better than the other - just different.

 
I've watched a lot of really smart people make some pretty big money mistakes. They range from raiding an already underfunded 401k at age 45+ for a child's college to refusing to shop the grocery store loss-leaders and instead buying spaghetti and pasta sauce at 7-11. All the time. For the vast majority of meals.


Find a place to start and dive in. If it wasn't the exact right thing, at least now you know one thing that doesn't work.