When You Can’t Pay Your Bills… How To Survive

what-about-me

Let’s talk about poverty. I don’t mean the kind you’re talking
about when your friends invite you to go shopping or for a night out and
you say, “No, I can’t. I’m poor right now.” I don’t mean the situation when you’d
like to get a nicer car but decide you should just stick to the one you
have because you don’t have a few thousand for a down payment. ~ Daisy Luther

I don’t mean the scene at the grocery store when you decide to get ground beef instead of steak.

I’m talking about when you have already
done the weird mismatched meals from your pantry that are made up of
cooked rice, stale crackers, and a can of peaches, and you’ve moved on
to wondering what on earth you’re going to feed your kids.

Or when you get an eviction notice for
non-payment of rent, a shut-off notice for your utilities, and a repo
notice for your car and there’s absolutely nothing you can do about any
of those notices because there IS NO MONEY.

If you’ve never been this level of broke, I’m very glad.

I have been this broke. I know
that it is soul-destroying when no matter how hard you work, how many
part time jobs you squeeze in, and how much you cut, you simply don’t
make enough money to survive in the world today. Being part of the working poor is incredibly frustrating and discouraging

It is a sickening feeling when you’re
just barely hanging in there and suddenly, an unexpected expense crops
up and decimates your tight budget. Maybe your child gets sick and needs
a trip to the doctor and some medicine.

Perhaps a family member is
involved in an accident and can’t work for a few weeks. It could be that
your car breaks down and you need it to get back and forth to work
because you live too far out in the country for public transit.

As our economy continues to crumble,
these are the situations going on in more homes across the country every
single day. It’s simple to believe that the people suffering like this
are just lazy, or not trying, or are spending frivolously.

No one wants
to think that these things can occur through no fault of the individual.
Why? Because that means these things could also happen to them.

Every time I write about crushing
poverty, someone adds the comments section a smug declaration about how
people need to get an education, hang on to a job, buy cheaper
food…there’s a litany of condescending advice.

I’m sure this article
will be no exception, and please, if you’re in the situation I’m
describing, let the criticism roll off of you.

The advice I have may not be
popular, but let’s talk about prioritizing your payments when you
can’t pay your bills. I am not promoting irresponsibility here. It’s
just math. When you have less money coming in than you have obligated to go out, you will not be able to pay all of your bills. It’s that simple.

First, do a quick audit of your financial situation so you can see where you’re at.

This list of priorities assumes that you
have some money coming in, but not enough to meet your obligations.
When things improve, you can try to catch up, but for now, you simply
have to choose survival. I suggest the following order of payments.

 

1.) Pay for shelter first

Your number one priority is keeping a
roof over your head. That roof may not be the roof of the house you are
in now, though, if your circumstances have changed and you can no longer
afford it. If you can still manage to pay your rent/mortgage, do so in
order to keep your family housed.

If you rent, and your rent is a
reasonable price, make this the first payment you make from your limited
funds. You really, truly don’t want to be homeless an moving is
expensive. Try your best to stay put.

If you own, consider your property taxes
and insurance as part of your mortgage, because if you stop paying any
of these, your home will be foreclosed on.

If you can’t pay your mortgage, property
taxes, and insurance, you have a while before the home gets foreclosed
on and you are forced to move out.

If this is the case, it’s absolutely
essential that you put aside money for the place where you’ll move
should you have to leave your home. You’re going to need first, last,
and deposits in many cases, particularly since your credit isn’t going
to be stellar due to your financial situation.

When you are in this
situation, it can be difficult to force yourself to save money when so
many things are being left unpaid, but if you ever hope to bail yourself
out of this situation, you absolutely have to do this.

The laws vary from state to state, (find the specifics for your state here) but basically, this is the timeline:

  • When you make the decision to let your house go back to the lender,
    you will have a month or two before they send you a notice of default.

  • From that point, you usually have 3 months before the foreclosure
    proceedings begin. During those 3 months, you should be saving the money
    you would normally be putting toward your mortgage.

  • At some point, you’ll get a notice to vacate the premises.

  • When this happens, you have two options. You can choose to move to
    a different home, or you can file for bankruptcy, if you feel your
    situation is such that there is absolutely no way out.

  • If you file for bankruptcy, the home can’t be re-sold by the lender
    for 3 more months, giving you more time to put aside money for your
    move.

Should we all pay the bills that we have
promised to pay? Of course we should. Our word is very important.
Remember, though, that the information here is for people who are in a
position in which they DO NOT HAVE THE MONEY TO PAY.

So, the bottom line is this: either pay your housing costs or put aside money for future housing as your first expenditure.

 

2.) Buy food

You have to eat, and so do your children. If you don’t eat, you’ll get sick, and then your situation will be even more dire.

  • Stick to simple, wholesome basics and cook from scratch. Beans and rice have fed many a family.

  • Tap into your inner southerner and make inexpensive, filling meals like biscuits and gravy.

  • Make soup to stretch just a few ingredients to feed a family.

  • Save ALL of your leftovers, even the ones on people’s plates. Add
    them to a container in the freezer and make a soup from that at the end
    of the week.

  • Clean up after the potluck at church. Sometimes you can take home the leftovers.

  • Don’t skip meals to stretch your food further. You need your health and your strength to overcome this situation.

  • Go to the library and check out a book on local edibles. Go foraging in the park or in nearby wooded areas.

  • See if your grocery store sells out-of-date produce for use for
    animals. There’s often a fair bit you can salvage and add to soups or
    casseroles. (This is the only way we were able to have vegetables and
    meat during one particularly painful stretch when my oldest daughter was
    young.)

In a worst-case scenario, food banks are an option as well.

 

3.) Pay for essential utilities

You should be cutting your utility usage
to the bare minimum and using every trick in the book to keep your
bills as low as possible.

If your utilities get shut off, it’s
going to be difficult to cook from scratch and you won’t be able to keep
leftovers from spoiling. You need the water running from your taps to
drink, cook with, and clean. Depending on the climate and the season,
heat may be vital as well.

If you can’t pay the entire bill, call
the utility companies and try to make payment arrangements. If your
utilities are shut off, then you will have a hefty reconnection fee on
top of the bill.

Another point to remember is that our
culture believes it’s absolutely necessary that all homes be plugged in
to the utility system. If you have a work-around, like wood heat and
hand pumped well water, and decide that your utilities are not
essential, you need to be prepared to face those whose opinions differ.

Some cities have condemned homes which are not connected to the grid,
and if you have children who are of school age, sometimes a “concerned”
teacher or neighbor has been known to report your situation to the
child welfare authorities. (Recently an off-grid homeschooling family had their children removed from the home by police.)

 

4.) Pay for car/work necessities

What must you have in order to keep
working? For me, it’s the internet, since I work online. All of my
clients contact me via email and the work I do requires that I be able
to send it to them and research things online.

I live in the country, so
driving to the library on a daily basis would cost more than my monthly
internet fees. For another person, this necessity might be the cost of
public transit or keeping their vehicle on the road so that they can get
to work.

Choose the least expensive options to keep yourself working,
but maintain your job-related necessities.

 

5.) Pay for anything else

After you’ve paid all of the above, if
you have money left over, now is the time to pay your other expenses.
These expenses include debt that you’ve incurred, contracts you are
involved in (like cell phone plans, etc.) Choose very carefully how you
dole out any remaining money.

  • Keep one phone going, with the lowest possible payment. This is
    necessary for work, for your children or their school to contact you in
    the event of an emergency, and as a contact point for your financial
    situation. Compare the cost of a cell phone, landline, or VOIP phone.
    Every family member does not require a phone – you just need one. (I
    actually did go for a couple of years with no phone at all, but I’m
    uniquely antisocial and had email by which I could be reached.)

  • If it’s at all possible, try to use the snowball method made famous by Dave Ramsey
    to pay off your debts and bail yourself out of your situation. Being
    free from debt will allow you to live a much freer life in the future.

  • If paying off debt is not possible, try to make the minimum payments.

  • If the minimum payments are not possible, you may have to default, at least temporarily, on debts.

  • Buy some pantry staples. If you can add some extra rice or cans of
    tomatoes to the pantry, it will help see you through this tight
    situation.

  • Be relentless in deciding what will be paid and what will not. This
    is not the time for arguments like, “But it’s our only form of
    entertainment” or “We deserve this one luxury.” Cut all non-essentials
    until things improve.

  • Focus on the most frugal options possible.

 

Things will get better

I’ve been down this road. I really get it. It saddens me to see people I love in this situation now.

These books can help. I found them to be
life-changing when I was broke, and the lessons have stuck with me
throughout my adult life. You may be able to find them at your local
library.

Finally, if you are in a situation in which you can’t pay your bills, I’m sorry.

I’m sorry about…

  • The embarrassment you feel when you can’t afford to meet someone for coffee

  • The sick feeling of seeing the bills pile up on the counter and not being able to do anything about it

  • The knot in your stomach every time the phone rings and it’s a 1-800 number that you KNOW is a bill collector

  • The stress of knowing you can’t remain in your home

  • The fear that someone will say you aren’t taking care of your kids and they’ll be taken away

  • The humiliation when people don’t understand and think it’s all your fault

  • The hopelessness of watching the bank account empty out the day your pay goes in, and still having a dozen things unpaid

  • The overwhelming discouragement of having fees assessed on top of debts you already can’t pay

  • The anxiety over what tomorrow will bring

It will get better. You’ll find a way to
make it work. You just have to survive while you make it happen. Maybe
you will pool your resources with another family, or get a raise, or
find a cheaper place. But you will find a way.

Life may not be exactly as it was before, but it will be good again.

Source

 

August 28, 2015 – KnowTheLies.com

 

Source Article from http://www.knowthelies.com/node/10720

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