We have all been there at one time or another. Our financial situations appear to be stable, and then an event comes along that tips the first domino over and sends the whole chain falling.
Dominos could be things like a family member getting sick, especially an adult. If half the family workforce falls ill they might not have insurance to help with bills, that leaves you with your income cut in half and new medical bills on top of that. A less drastic scenario is someone losing a job which can still cause a lot of financial stress on a household, cutting your income in half is never good.
A household’s debt situation may be more tenuous. Racking up debt in college is almost a rite of passage, thanks to student loans that have to be paid back within a specific time of graduation. Once you are in your 20s and 30s but still paying off student loans other bills might start filing in, causing stacks of bills, where do you start?
Eventually there is a tipping point. The bills are there, the money isn’t coming in fast enough, and it is enough to really stress you out and can cause some people to turn to less than legitmiate help. There are ways to get around this, even if they do take a little time for some savings to add up.
Consolidate Your Bills
If your bills get to be too much when it comes to credit cards, a counselor may be able to offer consolidation solutions. The bills are wrapped into one package, lowering the amount you will likely pay each month.
It works because creditors can’t bother you with repeated phone calls wanting to be paid. Everything is lowered into one easier to manage bill with a lower interest rate. It may take several years to pay off the loan or consolidation amount, but you will breathe a little easier.
If you have three or four cards with high dollar amounts owed, this might be the best way for you to get around a sticky situation.
Pare Down Existing Bills
Do you already use certain services? Switch to different services. Bundle your Internet, phone and cable TV together instead of paying three prices for three services. Bundling saves money and results in one bill instead of three.Other household expenses might the very things which cause your budget to be out of whack, do you have a home security system? Maybe you don't even need one? Or should you browse for a lower level and price, there is countless info on sites like securitychoice.com about pricing your home. Regardless a great way to save money is to stop paying extra for things you already have!
Avoid New Bills
While you are paying down existing bills, you should save money by avoiding new ones. Do not rack up other charges on credit cards or accounts, because you will get yourself back in the situation you wanted to avoid in the first place.
New bills on top of consolidation of credit cards will make it look like you can’t handle finances. That is the last thing creditors and credit-reporting agencies want to see, and that credit score will go down immediately. Too many open accounts spell trouble.
Close some accounts that are not being used and pay off the balances, high or low. The fewer bills you have on your record, the better off you will be.
Credit card debt can be daunting to overcome. There is no reason why you should drown in debt just because you can’t manage it.
Don’t be afraid to ask for help. Your record will be better for it down the line.