Many families are living paycheck to paycheck. Finances may be stretched to the breaking point. To find out if your family has too much debt, consider how you’d answer the following questions:
• Are you strictly making the minimum payments on your credit cards?
• Are you using credit cards for living expenses?
• Are you considering bankruptcy?
• Are you paying your bills after the due date and getting late fees?
• Are you over the credit limit on your accounts?
• Have your interest rates increased?
• Have your creditors reduced your line of credit?
• Are you receiving harassing phone calls by collectors?
• Are you afraid your property will be repossessed?
Did you answer “yes” to more than three of these questions? If so, your best financial tool—and the first step to getting out of debt—is to develop a budget. Determine your take-home pay for each month and your total household expenses. Track your daily expenditures: we all spend money without realizing it, whether it’s on a cup of coffee, lunch, or a soda. Set your financial goals: where do you want to be in six months; 12 months; five years? Knowing your income, expenses, and financial goals will help you to prioritize your spending.
By developing a budget, you’ll know when your bills are due. Sometimes they’re all due at the same time. If so, you can contact your creditor and ask to move your due date to either later in the month or earlier, depending on your budget. Most creditors will move your due date once. Contacting your creditors when you’re experiencing financial hardship is essential. Most are willing to work with you.
How to Save Money
By reviewing your budget, you’ll be able to see where you’re able to decrease expenses. What can you safely cut from your budget? Do you have cable or satellite TV? Now’s the time to cancel it. Do you have a cell phone and a land line? Eliminate one. If you keep your cell, be sure to choose the least expensive plan or an option that allows you to pay as you go. Do you have a high grocery bill? Now’s the time to clip coupons or contact Angel Food Ministries at 676-3000 or online at www.angelfoodministries.org for grocery help. A host site for Angel Food Ministry is located at Riverside Church on 714 Hamilton Road in Peoria. You can place your order and pick up your groceries there.
Developing a budget takes some time and may not always work perfectly the first month. Review your budget and make changes where necessary. Don’t give up—a budget is well worth your time and effort. TPW
Too Much Debt?