I Can’t Pay My Bills

Not being able to pay all of your bills is scary. After all, missing payments can come with repercussions like late fees, penalty interest rates, or loss of services.

But, just because you can’t pay your bills that doesn’t mean all hope is lost. You do have options that can help you minimize the damage if the situation is temporary or potentially find some long-term relief. If you are struggling to make your payments, here’s what you need to do.

Pay the Essentials First
If you know in advance that you don’t have enough money to pay all of your bills, be strategic about the ones you do pay. For example, make sure your mortgage or rent, electricity, water, food, and necessary transportation are handled before anything else. Often, these are the things you need for basic survival, so taking care of them should always be a priority.

However, make sure to limit any excess in these areas. Shop for lower cost groceries, restrict unnecessary trips that use gas, and lower your utility usage to reduce those bills.

Look for Help for Short-Term Situations
Sometimes, the reason you can’t pay your bills is a temporary shortfall caused by an emergency. For instance, unexpected car repairs or medical expenses can derail your budget short-term, though may not lead to a long-term struggle.

If your financial crisis is temporary, it may be wise to ask for help. Consider reaching out to friends and family for assistance or turn to area non-profits or churches to see if they have programs that can assist you during your time of need.

While asking for financial help can be hard, it is worthwhile. You may be able to borrow money for a little while without the high-interest rates that come with payday loans or fees associated with an overdraft. If you borrow from a friend or family member, discuss the repayment terms in advance. A disagreement can seriously damage the relationship, so you both need to be on the same page before you take the money.

If help isn’t available, you can contact your creditors and explain the situation. Depending on your history with the company, they may allow you to skip a payment without a penalty or will be open to accepting a partial payment, a sign of good faith, if you can make up the remainder soon. However, they don’t have any obligation to help you, but it’s usually worth trying.

Long-Term Solutions for Unmanageable Debt
If your financial situation isn’t going to improve any time soon, then you need to seek out a long-term solution. One potential option is to enter into a debt management plan with a reputable organization. They can help you lower your interest rates and payments on certain debts, including personal loans and credit cards. This may make it possible for you to afford your payments while you pay down the amount you owe while also giving you a way to fulfill your obligations.

Bankruptcy may also be an option, depending on how dire your situation is, but not everyone qualifies. However, you can usually get a free consultation with a bankruptcy attorney, giving you a chance to see if this might be the right path for you.

There are significant repercussions to bankruptcy. It will remain on your credit report for seven to 10 years, harming your credit score over the long-term. But that doesn’t mean it isn’t a viable option. When you consult with an attorney, you can ask about the consequences of bankruptcy to get a better picture of how the decision may impact your unique financial situation.

By following the tips above, you can find a viable solution for times when you can’t pay your bills. It may take some hard conversations, but it’s better to ask for help than to allow the problem to get worse.