When a 'Life Happens' moment arrives we have a problem! I’m talking about a mishap or a situation that puts our normal life out of balance and causes us considerable discomfort.

For example, if your car breaks down with a major mechanical problem you might have to catch public transport to work instead of driving. That probably means you have to leave earlier and arrive home later. You’ve then got less time to do your usual activities, so you either have to stay up later, or you don’t get to do some of the things you would normally do.

You need to get that car fixed!

You don’t have the money spare, so you use your credit card to fix the problem. You get your car back and your life goes back to the normal routine.

Aah! That feels better, problem solved!

But, the problem was not really solved at all, it was moved from the car to the credit card. It has not gone away at all, but YOU have gone back to your normal routine, and the problem is no longer causing you any discomfort at the day to day level.

When your life goes back to normal, you forget the problem, however in this case and most others, the cure now has the potential to become a bigger problem, with interest. Solve a few more problems with credit and you are digging a hole you will find difficult to get out of.

So how do you break this cycle; the one where you use easy access to the bank’s money to come up with an easy solution to your problems?

There is always more than one way to solve a problem and the easy way is usually the most expensive way. That is a general rule of life. People in marketing know that people will choose what’s easy over what’s best for them almost every day of the week.

So, you want to get your life back to normal but you don’t want money problems. How do you do it?

Firstly you need to remove the easy access you have to the bank's money. Start by reducing the Credit Limit on your credit cards so they are not potential fire starters! As you pay them off, keep reducing the limit.

You could also leave them in the freezer at home so you can’t use them. Put them in a glass of water - well ice actually!

If you DO solve a problem with credit, do not rest until you have paid off that debt, don’t think you have solved a problem until you have cleared the debt. Put a repayment schedule on the fridge door and cross off each repayment as you pay it down.

Then keep going; use that money to start building up a savings buffer in a savings account so you don’t need to use credit the next time something goes wrong.

You also need to look at other options, e.g. If your car does break down, maybe you could use that as an opportunity to permanently change to a new routine that does work for you. Could you work from home? Could you car-pool and save money that way?

Could you ride a scooter or a push bike to work?

Don’t just give in to the easy and most expensive solution. And of course, it pays to put yourself on the front foot. Could you learn how to check your car over regularly to reduce the possibility of it breaking down in the first place?

A Spending Plan will make it much easier for you to save a small but regular savings amount that allows you to deal with the Life Happens moments the right way!

I’ve used a car in my examples but you can apply the principles to just about anything.