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Don’t argue about your finances, resolve any issue easily

I want to share with you a language of connection for resolving conflicts. I have found it leads to clarity, ease and effectiveness, in work and personal life. It is not a foreign language, but a human language. It helps us return to presence and connection with ourselves and others, and to a sense of being “in the flow” of life.

This language is based in universal needs (e.g. safety, freedom, community) common to people across all cultures, and to all of life. It connects us at a level of shared humanity and empowers us to better meet our needs and serve others. We can learn to shift from the biological “fight-flight-freeze” survival reaction at the core of conflict – and the language and thinking that goes with it – back to what I believe is our natural state. When we are not “triggered” into conflict, we naturally have a positive inner experience and relate harmoniously with others, contributing with joy to one another’s wellbeing. This language of needs can be applied to three dimensions of communication: how we listen to ourselves (self-empathy), hearing beneath the difficult messages of others (empathy), and expressing ourselves in a compassionate and assertive way (self-expression).

I want to share a story I heard recently from someone in one of my training courses. Jill was in the process of closing a house sale with two of her clients, a husband and wife, when the couple started to argue. Jill started to react inside herself to their conflict, worrying that the business arrangement might fall through and internally judging their behaviour. She became aware of her reaction and began consciously observing her thoughts and feelings, identifying what was important to her at a deeper level.

So, what were they arguing about?

It transpired that the couple had been having arguments about their current finances. The husband, a keen saver, was adamant about not refinancing their current home, whereas the wife was a huge spender, using every possible source of credit to her.

The husband had just found out that the wife was secretly using online loan sites to get money to shop behind his back. Not only that, she had also taken out a car loan. She had been doing all this behind the husband’s back.

Don’t refinance your home to repay debt

You have a car loan that currently sits at 7% interest, you have credit card debt that currently sits at 14.99%, and you have the option of rolling both of those loans into a new loan after you refinance your home… should you do it? Probably not and there are two good reasons and one pretty good reason why. Similar to a payday loan, details here, these will spiral with interest the longer you leave them.

Good Reason #1: You Pay More Interest

Usually car loans are for five years so when you’re paying 7% interest each year, you’re really only paying it for five years so the total interest cost is relatively low. When you refinance a loan, say to a 30-year fixed or some sort of low rate ARM, you’re now paying for the lower rate, 6% or whatever, for thirty years. Five years at 7% on $10,000 means you’ll pay $1,880.60 in interest. Thirty years at 6% on $10,000 means you’ll pay $11,585.60 (you may be able to deduct it from your taxes so the interest really is three-fourths of that, or $8688.75).

Good Reason #2: If You Miss Payments, You Lose Your House

One of the many fallout stories with the mortgage industry is that of folks who refinanced in order to pay down their debt, in this case it was car and medical bills (so I can understand, there isn’t a choice at least with medical bills), and then found themselves unable to keep up with the payments. If you have a car loan and you can’t make payments, they take the car and you ride the bus. If it’s a credit card debt, it just goes into collections and you won’t get another card. If you have a mortgage payment and you can’t make payments, they foreclose on you and you have to find someplace else to live!

Pretty Good Reason #3: The Pressure to Pay Is Good For You

This isn’t a financial reason, it’s a psychological reason and so that’s why I say it’s only a “pretty good” reason. With a higher interest rate, you feel the pressure of paying it off and so you’re more likely to pay it off. If you roll it into a large mortgage payment, well you no longer feel the pressure and you’re likely to keep charging (if it’s a credit card).

What about Jill

Jill consciously focused on feeling the trepidation bubbling up in her and identified her desires for financial security, contributing at work, and respectful and harmonious communication. As she shifted her attention, her mind and body relaxed. She then saw that she could offer the language and skills for mediating conflict not only with herself internally, but also with this couple.

Jill started empathically reflecting back what she heard them saying to each other and guessing at what their needs might be. She asked the wife if she wanted her opinions to be heard and to know her experience was valued. She asked the husband if he wanted trust about how he perceived things and appreciation of his efforts and abilities.

As they both started focusing on what they wanted at this level, the tension in the conversation subsided. Jill then said she had found it helpful in such situations for each person to repeat what was important to the other, without needing to agree with what the other was saying or wanting to do. They said yes, and as they started to do this, the tone of the conversation completely changed. Expressions of mutual understanding, warmth, and care re-emerged, and before long they were all speaking constructively about the business arrangement.

Jill was thrilled about being able to catch and shift her own reaction and contribute to an important work situation. By using the skills she was learning, she was able to respond in a way that actually helped instead of watching helplessly or worsening the situation with a gut reaction.

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