A very good question. You are not alone.
Start with a quiet and calm mind
First things first.
Shut down all negative self-talk.
Eliminate all blame and shame.
Keep plenty of water nearby for hydration.
Do something to clear your head.
Walk the dog. Play with the cat. Smile at your infant.
Watch children play. Eat something tasty. Play soothing music.
How to Catch up past due amounts
There are several ways to deal with past due amounts. For large amounts, call the company. Do not text or fill out an online request.
Honestly explain your situation and your determination to get caught up.
Kindly ask to set up a payment plan.
Another idea is to use savings to pay past due amounts.
You could also use money coming from a work bonus.
Or a birthday gift.
Or a short-term loan from a family member to get the amount due paid.
You may find you are able to sell something to get the money.
If possible, avoid using a credit card to pay for past due bills.
This is not a good practice.
Gather your information
Grab your laptop or a notebook and pencil.
A calculator.
Then gather all your bills.
Include monthly, quarterly, and annual bills that you are obligated to pay.
This means credit card statements and agreements to buy now and pay later.
Next, get your check stubs.
As soon as possible - stop using buy now pay later plans.
Include Your Family in Money Talks
This means your spouse, children, anyone who lives with you.
This may seem odd, especially when you think about including the children.
But this is important.
Even though young ones may not understand everything that is going on,
but they do store these family memories for years, if not a lifetime.
Speak in a calm and rational voice
You are not doing yourself or anyone else a favor by
acting crazy, goofy, or out of control.
Keep in mind that you listen to yourself more than anyone else,
so stay soft-spoken and kind.
Do these simple money calculations
Step 1. Add up all household income from sources
that are contributing to the household’s livelihood.
Do not be ashamed or embarrassed if younger ones
wish to contribute to your debt free journey.
Let them help (kids remember the money lessons
they learn from their parents).
Also let them know that with everyone working together,
money freedom is obtainable.
Write down total household income.
Step 2. Add up all your current bills and obligations
along with the amounts that are currently past due.
Write down the total.
Subtract step 2 from step 1.
This will serve as a starting point.
This calculation lets you know if
you can pay what is currently owed to your debtors.
If you have enough money to pay your bills, great!
If you cannot, the next step
would be to brainstorm on how
to get more money into the household.
Include ideas like a side hustle,
or selling something you no longer use or want.
What you are looking for here is a quick way to get some extra cash.
Tip: Do not let this “bog” you down.
Ideas will come to you and your family members throughout the days to come.
Construct an at-a-glance Annual Financial picture
Getting organized financially is not as hard as you may think.
Determine your annual household income after taxes.
Monthly net pay from check stubs. Multiply by 12.
If you are working a side business, this means
determining your expected gross monthly income and
reducing that amount by local, state, and federal taxes
and then multiplying it by 12.
Add up your bills due over the course of a year.
An example might be rent.
If your monthly rent is $1,000, then annual rent would be $12,000 a year.
Of course, you would have to
look at your lease and figure out
when the next rent increase is due and
take that dollar amount into consideration.
Do the same with quarterly bills.
If you make a quarterly payment of $150, then multiply that
by 4 for a total of $600 per year.
Now, subtract money owed from your household income.
It may be time to get a side hustle.
What should and should not be included in
regular expenses is a topic of its own.
Write in if you want to discuss that.
Why is it important to look at an Annual Financial picture?
Because you may discover that you do indeed have enough money
coming in over the course of a year to pay
all the bills that come due over that year.
This could mean that from month to month, the bills you owe fluctuate.
This might mean that you have “extra money” some months,
while other months you find yourself coming up “short”
of what is needed.
This is easy to solve. You may not need that extra job.
Smooth out the Bumps in your Billing Cycles
You do this by refiguring your monthly bills due.
Each month, you add up the bills that are usually due in that month.
But here is where the smoothing out process happens.
Take all those quarterly bills that you owe and divide those dollar amounts by 3.
In our example of a quarterly bill of $150, divide that by 3 to
come up with $50.
Now add that $50 to your monthly bills due each month.
Do the same with your annual bills.
Divide them by 12 and add that amount each month to your monthly bills.
In our example of the $1200 annual insurance payment,
divide that by 12 to get $100.
Add that $100 to your monthly bills due each month.
In essence, you are “saving up” money
each month to pay for those quarterly
and annual payments that you make.
Reminder: If you have money questions – contact us at the website:
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