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By Terry Rigg
With ever increasing consumer debt more of us are finding ourselves robbing
Peter to pay Paul each month.
We go through our bills and find that the money just won`t stretch far enough
to cover all of the bills and expenses. It`s hard to decide who you should
pay when you have one bill that is stamped with "Final Notice" and you are
behind on several of your other bills.
If you don`t pay the credit cards you know that you are going to start getting
those harassing phone calls. If you don`t pay the house payment you are
looking at foreclosure. If you don`t pay the utilities they will shut them
off. How do you decide?
When you get to this point it`s time to get down to basic survival and work
from there.
I have actually talked to people that stated their credit cards were up to
date but their mortgage was two months behind. This is one of the biggest
mistakes we can make when we don`t have the money to pay everything.
Another mistake I see on a regular basis is that some people pay their bills
at the expense of their food budget.
If you have the money to pay some of your bills you have to start with
groceries first and necessary health items. You can try to save as much as
possible on your food but that money has to be set aside before anything else.
The next bill you must pay is your mortgage or rent. While credit cards
companies will drag out their collection process, mortgage companies and
landlords will start the process of
foreclosure or eviction within just a couple of months.
Your next priority is your utilities. In many cases utility companies will
turn off your utilities if the bill isn`t paid within a few days of receiving
the bill.
Once you are sure you have enough to eat and a roof over your head you can
start thinking about your other bills. The secured loans, like your car
payment, should come before your
unsecured loans, like your credit cards.
The reason for this is simple. Creditors that have secured property will sue
or repossess much quicker than the credit card companies.
If you find yourself in this situation it is a sign that you need to do
something drastic and fast. By not paying all of your bills each month they
are going to add up quickly and
you are going to accumulate a lot of late fees.
The best place to start is to find out exactly where you stand and what is
causing the problem. This is as simple as listing your income on one side of
a piece of paper and your bills on the other. Total each and subtract your
bills from your income.
Your next step is to develop a budget. You can find a free and simple budget
by visiting The Complete Budget and Bill Organizer at http://www.
homemoneyhelp.com/BBOonline.html (HREFhttp://www.homemoneyhelp.com/BBOonline.
html)
Whether you use my budget system or another it is very important that you
start one as soon as possible. For those of you that believe a budget is to
restrictive, just the opposite is true. The only way you can get what you
want and know you can afford it is to have a
budget in place.
It is important that you pay all of your bills on time each month. When you
don`t have the money to pay everything it is vital to your survival that you
pay the most important bills first.
Terry Rigg is the author of Living Within Your Means - The Easy
Way http://www.homemoneyhelp.com/ebookadpage3.html (HREFhttp://www.
homemoneyhelp.com/ebookadpage3.html) and editor of the Budget Stretcher web
site. To Subscribe to The FREE Budget Stretcher Newsletter and receive The
Complete Budget and Bill Organizer absolutely free just visit his home page at
http://www.homemoneyhelp.com (HREFhttp://www.homemoneyhelp.com)
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