Troubled finances? It's not a lack of blessings, just some bad financial practices.

Many years ago, I worked as a collections officer with one of the countries largest financial institutions. My responsibility was collecting on some of the companies bad loans facilities.

A few weeks into the job, I was surprised by two things;

1. The size of the bad debt portfolio, which ranged in the hundreds of millions of dollars.

2. The number of people that were in debt.
   

This raised one main question for me, 'Why were there so many people with such bad debts?'

Also, I felt let down by the financial institution because it was their responsibility to encourage people into better financial practices.

I quickly grew out of that naive outlook on what big business is supposed to do from a corporate social responsibility standpoint and recognized that the onus is on the individual to not allow themselves to get into that negative financial state.

Here are a few things as a society we do when it comes to finances;

• We have a poor understanding of money, how it works, how to earn, accumulate, multiply and ultimately save money.

• We take financial advice from the wrong people.

• We have little understanding of how financial systems work.

• We take shortcuts or try to use a plaster when we should be looking at gores.

• When all else fails, we then turn to God for a blessing.

Here is an example: Someone takes a loan to pay off a debt at another financial institution. They get approved and feels relieved about their financial future. Makes promises to friends, family, GOD and themselves that they will never be back in a financial situation like that again.

Six to twelve months later, guess what? The signs are beginning to show again. This is where the lack of methods or bad financial practices come in.

Here are five (5) things that can help us in our drive for financial independence.

1. Skill Set

We would all like to see positive changes in our incomes, but here is a reality in how employees are compensated. Your income is directly proportional to the job you do, your ability to do it well, and the degree of difficulty in replacing you. - Earl Nightingale

All jobs are important, from the sanitation worker to the CEO but they are not compensated equally. Based upon your skill-set and your needs for additional income. Find ways of diversifying your income by looking at something you are good at or you like doing. Especially where you have control over what or how much you earn.

2. Financial Planning

Whether you have single or other sources of income coming in, it is wise to plan what you intend to do with that additional money for the present and the future. Having a goal is crucial to getting on the right side of a bad situation, especially our finances.

3. Financial Management: (Do not enslave Yourself)

There are two ways to conquer and enslave a nation. One by the sword, the other is by debt. - John Adams (1735 - 1826)

As a society, we have to understand that money is our tool and we are the tradesmen and women who have to make better use of the tool of money for the life or lifestyle we desire.

Also, are our hardware store where we go to acquire the tool (money) to get things done. We do not buy a hammer if we are not going to put it to use, do we?

Then why go to the bank for frivolous things? This is where a better understanding of how to use and manage our tools and institutions is crucial.

4. The Right Practices:

One of the things financial institutions do with every client looking for assistance is to calculate their Debt-to-Service Ratio (DSR).

Basically, it is an understanding of what percentage of your earnings go to bills? Also, profitable companies are always looking at ways to cut costs or expenses to improve their bottom line. These should be the practices an individual should adopt in their own lives as well.

5. PROVERBS 20:21

Most of us may have experienced or know someone with financial challenges. They have tried all possible options as well as asking GOD for help. After all the efforts failed and things looked dismal that unexpected cheque, dividend payout, a contribution from a friend, tax return, etc. comes in and saves the day.

We feel relieved, but this is where the problem exists or starts.

Proverbs 20:21 says An inheritance hastily gained will not be blessed in the end.

That reminds me of the stories of people who won millions in state lotteries yet today are now back to paycheck-to-paycheck or, worse, homeless. Catching a financial break is just a plaster on a wound, and if not tended to it the right way, it will never heal properly.

See Business Insider Report: http://www.businessinsider.com/17-lottery-winners-who-blew-it-all-2013-5?op=1)

Prayer is key however instead of just praying for a blessing to pull you out of a financial bind. Maybe structure the prayers around giving you the wisdom to arrest and correct the bad practices.

Without the correct methods, we will end up in that cycle over and over again.

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Written by: Lyndon H. Brathwaite

Inspired by: Real Events