Getting behind on bills is not a place anyone wants to be. However, sometimes it happens and you might think that there is nothing you can do about it. It’s safe to say that most people have gotten behind on bills at one point or another.
Regardless of the circumstances that put you into this financial situation, you need to know that there is always a way out. Knowing where to start and setting up an actionable plan to tackle this situation will help you to get things under control again.
Getting things back on track is all in how you handle the situation Here are some steps to take when you’re behind on bills.
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What to Do When You Are Behind on Bills
1. Put yourself on spending freeze
If you are behind on bills, the last thing you should be doing is buying anything new. The best thing you can do is put yourself on a spending freeze. A spending freeze is when you don’t buy anything except the essentials. No fast food, no large purchases, and no unplanned spending what-so-ever.
2. Call the companies
When you are behind on bills, one of the best things you can do is to call your creditors right away. Explain your current financial situation and ask if they could give you a grace period or offer any type of extension. They need to hear from you. You may think it won’t make a difference, but it could mean no late fees and a little bit of grace time to make the payment.
Calling the companies is always a smart idea whenever you’re behind on bills. Is it a little humbling? Yes. However, you gotta do what you gotta do to make it through this hard-financial season.
3. Make a plan on paper
Many of you know that budgeting comes down to putting an idea to work. There are a few steps to budgeting when you’re behind on bills. However, one of the most important steps is to recognize your debt and make a list of all your expenses and income. This time, you will need to set a budget that will work for you and stick to it. Getting that on paper is the first step in the right direction.
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4. Get caught up on your four walls
Rent or mortgage should always be a top priority. You need to have your four walls taken care of before you can pay your other creditors. Your four walls consist of the necessities: housing, food, clothing, and transportation. Making sure these four things are taken care of first will help you get the rest of your finances in order.
5. Cut expenses
When you finally get things back on track and are looking to keep your budget where it needs to be, consider cutting expenses.
Do you need to have cable and the internet? Start cutting expenses; it will be worth it in the long run. The more cash you have at the end of the month, the better. Spending unnecessary money can put anyone in a bad financial predicament.
Use Money Saving Tools to Reduce Expenses
Another way to cut your expenses is by making sure you use resources that can help you save money.
Make sure you use Ibotta, which is a free app that allows you to get cash back on groceries, clothing, restaurants, gas stations, pharmacies and more.
When you buy your groceries, you earn cash back with Ibotta from your regular purchases at the store, such as buying fruits, vegetables, dairy, bread, household items, and so on. You can even get cash back just for submitting your grocery receipt!
There were several occasions where I was able to withdraw $200 or more from my Ibotta account. Believe it or not, this amount of money can be a huge help when trying to cut your expenses at home
Bonus: If you’re new to Ibotta, you can get $10 FREE by just signing up through this link.
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6. Make extra money
When you’re behind on the bills, one of the best things you can do is make extra money. Making extra money can really help you pay your late bills faster. There are different ways you can try to earn a side income.
Some things you can do to earn extra money could be finding a second job, starting a side business, or selling your belongings as quickly as possible. Selling your belongings is as simple as walking into your basement or garage and seeing what is of value. You’d be surprised as to what people will buy from you. It’s not always easy going through stuff to sell, but it is totally worth it when you earn that extra cash.
Here are some of my favorite ways to make extra money working from home:
Completing online surveys: Sharing your opinions about a product or service is a great way to earn extra money in your free time. These are my favorite online sites:
- Survey Junkey (My top favorite survey! Easy to use and the fastest way to start earning money)
- My Points (Easy way to get gift cards! Also you can get a FREE $10 Amazon gift card with your first purchase.)
- Swagbucks (Free $5 sign up bonus)
Selling things online: A week ago I was able to earn $100 in less than 4 hours! How? By listing an item for sale on Facebook! It just took me a minute to list it! Places such as Facebook, Craigslist, eBay or Amazon are a great way to start selling and earning money.
Start a Blog: This is by far one of my favorite ways to earn extra income. You can start your own blog for cheap and start earning a passive income from this. I’ve developed an easy step-by-step tutorial on how you can start a profitable blog from scratch and bring traffic to your site.
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7. Start saving for an emergency
Whenever a financial issue strikes, it best to have an emergency fund. Of course, if you’re behind on your bills, this can be hard to do. However, once you are caught up, it’s wise to start saving.
Start by saving as much as you can a week to get a good nest egg in place. Most financial advisors suggest having at least $1,000 put away to help take care of any financial emergencies that may come along. The money is there to use so that you don’t find yourself getting behind on bills.
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8. Stop the bad habits
Financial crisis can happen through no fault of your own. However, sometimes they are your fault and you need to do something to avoid financial issues in the future. This is also a good time to forfeit any bad habits that keep you financially tied down—habits like smoking, gambling, drinking, or excessive shopping. Money doesn’t grow on trees and shouldn’t be treated like it does.
9. Stay on your toes
Getting your budget back on track when you’re behind on bills isn’t always an easy task. However, it’s important that you are able to stay on top of your bills and pay them on time. These tips can help you to get back on track when you are behind on bills. They can also be a good starting point to learn how to use your money wisely.
Just remember to not live above your means. If you need to, get a second job for a short period of time to help get that cash flow going. Stay on your toes and never get comfortable financially. Always work hard to keep things on track as much as possible.
Have you ever been behind on your bills? What have you done to get back on track? Do you have any tips to share?
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