As people who are naturally good with money can tell you, it takes equal parts consistency and self-control to maintain healthy personal finances. That can spell trouble for people with ADHD.
But don’t worry-with a little prep work, you can end up just as comfortable as anyone else, even starting from less than ideal circumstances. Read on for the top four ADHDer money traps, and how to fight your way out of them.
The Delay Tactic
Personal finance is annoying, dull, and kind of a bummer. Right? It certainly is when your money is in an unhealthy state. Dread takes over when it’s time to balance a nearly empty checking account, or when your credit score might be low enough to break the scale. It’s so much easier to put it off. It’s okay, it happens to most of us, but it’s time to get over that. Starting now.
Over at ADHD Management, they have some good advice on an attitude adjustment in their article “Mindfulness and Money Management for Adults with ADHD.” “Be aware that money is not intrinsically ‘good’ or ‘bad’-it just is. It is just a tool for helping us get things we need and want… Use the practice of mindfulness to focus on the fact that money is just that-money… Being aware of this fact can free you from your past ideas of money that may be hindering your progress.”
Take ADHD Management’s advice and distance yourself from your emotional issues with money. There is so much more to this topic than just dollars and cents-how we deal with money becomes part of our identity. Maybe you had plenty growing up, and never ‘learned the value of a dollar’ and developed bad spending habits. Maybe your family was very cash strapped, and money still remains this never-enough, status-symbol concept that fills you with panic and resentment. Whatever the emotional baggage is, step away from it. An ADHD coach or other member of your support team could be very helpful with that.
If the bad feelings and delays are too much to overcome, there is still good news: you can pay someone else to handle your money for you! Registered CPAs can do your taxes and other accounting tasks for a relatively low fee, and they can also advise on other specialists for specific financial issues. Find one in your area through the American Institute of CPAs. Sometimes the supervision of an expert is exactly what you need to make progress.
The Budget Blunder
A budget is essential when it comes to getting finances under control. You need to know how much money you have coming in and how much your day-to-day expenses amount to. You might have an estimate in your head about how much you pay for each meal or the proportion of necessary items versus entertainment items, but the actual numbers could shock you. Take these steps to create a budget you can stick to.
For a week, carry around a notebook and write down every time you buy something or pay a bill. Smartphone users can use a high tech alternative with apps like Mint, Expenditure, MoneyBook and iReconcile that do basic accounting plus more.
After a week of tracking, tally up how you spend your money. Also include other bills that didn’t come up in the course of that week. Write down all sources of income too.
Now comes the tricky part: spend within your means. Simple theory, tricky implementation sometimes! A good rule of thumb is 60% towards essentials like housing, food, utilities and taxes, 20% towards savings and paying off debt, and 20% towards personal expenses like entertainment, clothing and travel.
Figure out ways to cut back in the areas where you’re overspending. One great source is the ADDitude Magazine article “Budgeting Strategies for ADD Adults: 18 Tricks.” Another resource is Stephanie Sarkis’ book ADD and Your Money.
When the number crunching is in hand, make a list of bigger financial goals and the baby steps to reach them, even just $10 a week in savings. It might feel intimidating or premature to start saving for big, far-off expenses like retirement or college for your children, but you’ll be glad you started now and a little can go a long way.
Create a Fun Fund! Even if it’s just a jar of change that you fill up over time, setting money aside for a rainy day splurge will give you something to look forward to. Disneyworld, here you come!
The Late Payment
So you have made peace with your emotional money issues, your savings account is growing nicely and you’ve got your food, utility and car payments as low as they can be. Unfortunately, you’re not out of the woods yet. Late payments (and the big penalties that come along with them) can be a major issue for people with ADHD.
The blog over at Totally ADD puts it best in their post “The Penny Drops.” “Why do we struggle with money?… Perhaps the 5 ‘Payment Due’ reminders are buried in the growing hillock of unopened mail in the hallway. Or the bills went to our old home because we forgot to send out Change of Address cards. Or worst of all, we actually have the money to pay but we simply forgot. Again!”
There are two main ways to tackle this issue: old-fashioned or digital. The old-fashioned way involves some supplies and monthly diligence, without fail. First get a file storage tub, an inbox tray, or a wall-mounted mailbox-whichever you prefer. That holder will be used only and exclusively for bills. Even if you don’t open the mail, put anything that might possibly be a bill in that holder as soon as it arrives. Then choose one day a month when you sit down with the checkbook and pay the whole batch at once. Whether it’s the first day, the last day, the 13th, whatever, as long as it is an appointment you never break, you will be all set.
The digital option is to make every bill in your life an automatic online payment. This tactic involves more effort at the start but is almost totally hands-off from then on. Talk to the companies you do business with and get directions straight from them about automatic bill pay. If necessary, you might have to change providers, but that drastic step might be worth it if it saves your credit score. Just don’t forget to check in from time to time on the transactions to make sure there aren’t any mistakes!
The Impulse Buy
Did you know that there are highly paid professionals who specialize in retail store layouts? Where to put the clearance rack, which items are next to the changing room entrance-this is big business. They know just where to place the items that make people splurge. Their bread and butter is the cash register line, loaded up with items that are usually cute, tasty, fun, or otherwise irresistible-not to mention totally frivolous. These expert store planners know how to tempt even the most tight-fisted shopper into an impulse buy, but someone with ADHD? You are their dream come true. Nevertheless, you can do plenty to avoid the impulse buy trap!
Avoid temptation. Anyone will tell you, the surest way to avoid a mistake is not to give yourself the chance to make it in the first place. If a particular store is your weakness only go there as a special reward to celebrate achieving a specific goal, and otherwise find somewhere else to shop. If shopping in general is an issue for you, make your list and put that responsibility on another family member, or only go with the exact amount of cash you will need (leave the credit cards at home!). If online shopping is your rabbit hole, only shop brick-and-mortar.
Go shopping the way you go to the doctor. When you go to the doctor, dentist or dermatologist, are you tempted to order one of everything? I doubt it. You want to get in and get out. It might sound like a downer, but do what you can to make shopping into more of a chore than a treat. List what makes shopping fun, and then forbid yourself from doing those activities.
Visualize the worst-case scenario. This exercise will work especially well after mapping out your budget. When you’re shopping and something catches your eye, stop yourself before picking it up. (Don’t touch it! An Ohio State University study from 2009 found that shoppers are more likely to spend unwisely when they touch the object.) Think about the items on your budget that you’re saving for. Make yourself acknowledge that you are taking money away from the Fun Fund. To use the example above, picture yourself standing outside the gates of the amusement park, unable to buy a ticket, just because you kept buying silly things like tee shirts/smartphone covers/snacks/DVDs on a whim.
Follow these tips and the others offered by the experts mentioned above, and by this time next year you will be free from the Money Traps!