Financial Stability After Rehab
Financial Stability After Rehab
Table of Contents
Achieve Financial Stability After Rehab
Finding financial stability after rehab is not easy for most. There are a thousand things all happening at once and financial stability can often seem like just another cog in the system after graduating rehab. It’s important to remember that completing treatment is the first step in becoming financially stable. Let’s cover a few others.
How Addiction Ruins Finances
At the height of addiction, money is key to getting more drugs. It may not be used for bills, which can result in high collections, hundreds if not thousands in fees, and a poor credit score. This causes higher interest rates in the long term.
In many cases, addiction can also lead to criminal activity and legal charges which not only result in hefty fees but also limit future gainful employment.
Learning Financial Skills
To be fair there are many people unaffected by addiction that struggle with finances. However, to climb out of significant debt, earn financial stability, and survive on lower wages, smart choices must be made. In order of importance:
Saving money while broke is both the most important and hardest financial skill to learn and it’s made even trickier when you don’t make enough to save a significant amount. Financial stability is harder to reach when you have little discretionary income. For example, if you make $2,000 a month but your bills, including food and gas, are $1,800 then you don’t have a lot left over to put away. And what little is leftover becomes easily absorbed by a sudden expense like a car repair or hidden surcharge.
Putting money away after rehab, and in general, is going to come down to sacrifices and lowering monthly bills. You can do this by buying cheap foods in bulk, walking whenever possible, and avoiding fees.
There’s a chance that I may just be talking to my younger self, but stop living on overdraft. Millions of dollars per year go to bank fees, collection fees, late fees, surcharges, etc. These fees are a high hurdle to overcome when trying to earn financial stability. The average overdraft fee for example is $15.00 on the low end so imagine getting two of those in a month because you went negative a few dollars. It adds up – especially over the course of a year.
But avoiding fees involves more than just overdraft. Addiction, as mentioned, can lead to poor credit. There are many predatory lending or “Check Cashing” businesses that may seem like a quick and easy solution to a bill or cash needs. However, these companies charge extraordinary interest rates ranging at 35% or higher which results in paying back far more money than what was originally needed.
Think of financial stability as a long-term plan, not a short-term fix. It’s better to go without for now so that you consistently can have what you need later. Consider paying a little on your bills every time you get paid and not just on the “bill check” this way you have less going out at once which results in more liquid money (as in usable money). That tiny bit of financial wiggle room can go a long way when you need it.
Open a Savings Account
This isn’t always doable after rehabilitation due to required minimum balances and account opening costs, but it should be a financial goal in your plan for financial stability. Just having the opportunity to segment your hard-earned dollars also provides a barrier between you and unnecessary spending. Savings accounts are typically only linked to debit cards by request meaning it’ll be a little harder to impulse purchase or overspend.
This is an easy free way to build your financial skills. You can use online banking to track your purchases, monthly bills, and most importantly keep track of your balance. It can be tempting to avoid looking at what you suspect may be diminishing funds but it’s certainly not a good idea to avoid checking them. Oftentimes, the balance in your head and the balance in your account are going to differ drastically.
Online banking is also a great way to be aware of and avoid fees which we already discussed as a major problem to overcome when striving for financial stability after rehab.
Finding Employment After Rehab
Getting a job after rehabilitation is going to depend a lot on self-presentation, resume, and relevant skills. The good news is that those are the same parameters for everyone so you’re not starting far behind. However, there are still a few challenges you’ll have to face.
The Unexplained Gap
Employers hate to see an unexplained gap in work history. You know the kind of time gap that someone who just got out of rehab might have? While you do want to be as honest as possible in an interview, there’s a way to phrase events so they sound better to potential recruiters.
Because you’re legally not required to go into any depth about your time in an inpatient facility you can simply state that you took a leave of absence. You can also say that it was resolved personal matters that kept you out of the workforce.
If for some reason the employer presses and you feel obligated to tell them exactly where you were, then you can say that you had challenges with addiction but you’ve overcome them and are eager to rejoin the workforce. Essentially, you want to be brief. It’s not healthy to be defined by the battle with addiction within the workplace. Building a new life away from those labels is possible as it is leaving the old you behind.
Some people continuously keeping their minds off of substances as a way to cope in recovery. But others tend to get overwhelmed by the stimuli, demands, and pressures of the workforce. This is also normal and nothing to be ashamed of.
It can be a good idea to take a part-time position to ease back into the workforce. Or a job with four, ten-hour shifts so you can take an extended rest period over a three-day weekend.
The Eternal Job Hunt
We all know someone who’s taken months to get an interview and still doesn’t have a job. Some of us have even been that person. Rest assured that there’s still hope. If you’re simply looking to start making money doing honest work, then remember that it’s mostly a numbers game.
You’re competing with a competitive job market and employers’ predetermined assumptions. This is why it’s a good idea to not make your rehabilitation a focal point in any resume, cover letter, or interview. If you’re applying to entry-level positions and still haven’t gotten an interview or call back, then it’s time to revamp your resume.
Choose Your Financial Goals
It’s important to use goals as tool to reach other accomplishments, not the least of which being financial stability. There are several personalized financial goals you can set for yourself but here are some important ones that everyone should have:
Open a savings account
Buy or pay off a vehicle
Pay off large debt
Start a small business
Make enough to live on
Buy a home
Finding Housing after Rehab
There are two main choices for housing after rehabilitation. There’s either a sober living house or alternatively, the prior place of residence. Finding the best one is going to depend on home living situation, availability, and influences.
Sober Living Home
A sober living home is perfect if the prior place of residence is dysfunctional or otherwise unhealthy. This can mean more than exposure to drugs. An unhealthy home can also involve emotional manipulation, volatile surroundings, or severe traumatic triggers. Sober living homes also have much lower rent than the surrounding areas. So they’re a good place to start while longer-term housing arrangements are made. They can also help you learn the life skills to reach financial stability after rehab.
Going home is a great option when it provides a strong support system often in the form of family or friends. If substance use disorders started outside of the home or elsewhere, then returning to a safe, nurturing environment is healthy, and if you’re lucky it’ll be free too.
If you’d prefer to go to a sober living home but don’t have it as an option, then remember to follow the routines learned in your inpatient program. Getting involved in a supportive sober peer group (either in person or online) can also help with long term sobriety.
Ways to Begin Dealing with Debt
Dealing with debt is about putting one foot in front of another. Very few of us get to get out of our debt in one or two large payments. But there a couple of things you can do to help get ahead and achieve financial stability.
Pay Off High-Interest First
If you’re not overly familiar with interest then just know the higher the interest is the more you pay in the long run. It’s a good bet to tackle high interest first to save you hundreds if not thousands in extra payments.
Here’s a fun fact – a minimum payment is split between the principal balance (the amount you actually borrowed) and the monthly accrued interest. A trick to pay debt down faster is to make a payment for an amount larger than the minimum or make a second payment. Any amount above the minimum goes towards the principal balance, which will result in less interest being charged in the long run.
What to Do About Family and Finances
Many people in recovery have a history of borrowing money from family. Once you’ve completed treatment you may feel internal and external pressures to pay them all back. This isn’t always easy. Especially with little to no income, but it can be done over time. Treat any familial debt like a loan that you must pay every month. A little here and there can go a long way both in erasing your debt and repairing emotional bonds with family.
Ways to Begin Rebuilding Credit
Rebuilding credit is going to take a little more than time and small payments. It’s mostly going to be a proactive journey and a little maneuvering.
Reduced Pay Off
Call the companies that have you in collections and request a reduced pay off. Many companies will cut 10-50% off the bill just to ensure payment. However, if for some reason you can’t receive a reduced bill then it’s still a good idea to pay off the debt over time. Otherwise, it’ll be at least seven years until it falls off your report.
Credit Bureau Disputes
If you’re certain you’ve paid a bill on your report or that it’s being overcharged, and it can’t be worked out with the company then a credit bureau dispute is a good option. It involves talking to all 3 of the major credit bureaus, Experian, Transunion, and Equifax, and explaining the issue. This process can take up to 3 months but it’s a retroactive fix so it’ll be like the issue never happened. This is a step to financial stability that most people overlook.
Stop Applying for Loans
Whenever credit is checked for a loan it lowers the score. The drop is small but can add up after repeated checks. This includes credit card applications, payday loans, and more. Allowing these checks to fall off your credit without adding new ones can do wonders for your score.
Avoid Relapse Caused by Financial Stress
Finances can weigh everyone down and for someone in recovery that weight can sometimes be too much. Stay focused on your goals, not just the financial ones but personal ones as well. Each day is a new opportunity to be the person you want to be. The cravings will always be there. But you don’t have to deal with them alone.
Get support and talk with someone if you’re afraid of relapsing. Money can always be earned no matter how difficult but good health must be protected. Be patient with yourself and keep pushing forward toward financial stability.