How to Make a Fresh Start After A Financial Setback

Kids, go get your mother. She’ll never see another fire like this one. –Thomas Edison

Many of us have burned through money. Even more of us have seen our finances go up in smoke. But Thomas Edison literally saw his life ravaged by fire over and over again.

He lost his first job as a railway newsboy after catching a train on fire while performing an experiment in a baggage car. He lost another job as a telegraph operator after an equipment experiment almost blew up the telegraph office.

But worst of all, after obtaining legendary success as an inventor, he watched his world-famous laboratory complex, known as his “invention factory,” burn down in 1914.

Not only did it contain most of his life’s work and plans for future inventions, he only had sufficient insurance to cover about 1/3 of the physical damage.

Here’s how he gained a fresh start at age 67, when most people would have called it quits.

Save Whatever is Salvageable

While his film factory was burning, Edison and coworkers rushed into surrounding structures to carry out prototypes and boxes of plans and paperwork.

He then focused the fire brigade on saving the Experimental Laboratory.  This building contained the unfinished models, designs and materials for his nearly finished oxygen generation device, which would allow submarines to stay under water indefinitely.

Despite a major setback, there may be areas of your life that are still salvageable too.

Perhaps your credit can be preserved by asking creditors for an extension on this month’s bills. Perhaps brown-bagging your lunch from now on could free up enough change to keep the lights on.

Begin Rebuilding Immediately

On the night of the fire, Edison told a newspaper reporter, “Although I am over 67 years old I’ll start all over again tomorrow.” And that’s exactly what he did, leading all 7,000 of his employees in an effort to clear debris and begin reconstruction.

With finances, the best way to begin rebuilding is to create a new budget based on your current life situation and then use that to create a plan for your financial future.

Break lofty goals into manageable chunks.

For example, rather than just writing down get a higher paying job, your plan might include items like updating your resume and reaching out to contacts in your professional network.

Look for a Silver Lining

While Edison watched firefighters struggling to see in the dark without power, he realized there was a real need for brighter lighting equipment with a portable power source.

Within two days of his facility burning down, he finalized the design of a three-million-candlepower searchlight that operated on batteries.

Your silver lining might not be as groundbreaking, but if you can find something positive about your situation, even if it’s small, it’ll help everything not feel as bad.

Perhaps this is the perfect opportunity to become a minimalist. Perhaps this is the excuse you needed to apply for loans or scholarships to finish your degree.

Rely on Hard Work

As Edison once said, “Opportunity is missed by most people because it is dressed in overalls and looks like work.”

I only know of one surefire way to make money, and that’s to work for it. When you’re broke, a better life is possible, but getting there is going to require you to hustle and put in long hours.

It won’t be easy.

But take heart knowing Edison punched the same timeclock his employees used every day. After the fire devastated his business, both he and his employees worked double shifts producing more than ever. They called it the eight hour day—eight in the morning and eight in the afternoon.

By the following year, his business had risen out of the ashes and had revenue far exceeding the amount lost in the fire.

He didn’t quit. He didn’t give up hope. And there’s hope for you too.

 

Adam Lucas holds a Finance degree and an MBA from the University of Kentucky. His work has appeared in many major outlets including AARP.org and GoBankingRates.com.