Managing finances is never easy — especially when unexpected setbacks occur. Whether your paycheck didn’t arrive in time to pay the rent or you find yourself struggling to keep up with rising costs of living expenses, it isn’t unusual to find yourself struggling to pay the bills.
Unfortunately, ignoring your bills and hoping that they’ll magically disappear isn’t going to help your situation get any better. Not only might you face consequences like getting kicked out of your apartment, but you’ll also do some serious damage to your credit history.
So what can you do if you don’t have enough money to cover a mounting stack of bills? Here’s a closer look at the strategies that will help you achieve financial recovery now and in the future.
Find Alternative Payment Methods
If you know you aren’t going to be able to pay a bill on time, you must first start by examining your other payment options. It’s usually a good idea to call your credit card provider or landlord first to explain your situation. Sometimes, they will allow you to make a smaller payment that you can afford now so you can pay the rest of the debt later without any negative consequences.
Such discussions will also give you a good idea of what late fees or other penalties you might expect for not paying on time. Sometimes, it’s easier to take a small $25 penalty if you know you’ll be able to pay the bill a day late.
When such options aren’t available, you’ll likely need to look at other methods for getting the cash you need. Many individuals find relief when they take advantage of no credit check loans, which use income history to determine borrower eligibility. Though you will need to pay back these loans later, such short-term borrowing can help you get by until your paycheck arrives. When possible, friends or family may also be able to provide assistance.
Once you’ve received a loan, you should then take a look at the current debts that you need to address. Focus on the essentials, like rent, utilities, food, and transportation. It won’t do you much good to pay off your cable bill if you get kicked out of your apartment for not paying rent.
Another useful step for prioritizing your bills is examining how long it takes before the negative consequences affect more than just your credit score. A missed credit card payment is bad, but if your electricity is going to get shut off within a week, then that debt should take priority.
Many individuals also find relief by eliminating smaller bills first, and then working on larger debts. By taking steps to reduce how many different sources of debt you have, you can gradually improve your credit rating and avoid accruing interest on multiple accounts.
Plan For the Future
You shouldn’t find yourself struggling to pay the bills each month. After you’ve resolved your most immediate payment problems, take a step back and re-evaluate your financial situation. Take a look at how you spend your money each month and try to identify areas where you can reduce your expenses.
Plan for the future by establishing and following a monthly budget. Determine how much you can reasonably afford to spend on everyday needs. Quite often, managing future bills will require some type of sacrifice. It may not be fun to move into a cheaper apartment or cancel your cable subscription, but such steps may be necessary to help you be better positioned to pay off your debts.
Finally, try to set aside some money each month in a savings account. By saving for a rainy day, you’ll be better prepared for whatever financial challenges might come your way.