Can’t Pay Your Bills? Here Are Some Things You Can Do

Do you ever find yourself in a situation where the money left over in your bank account at the end of the month doesn’t seem like enough to cover your essential expenses? Figuring out what to do when you can't cover your bills can stressful and challenging. Fortunately, if this happens to you there are several strategies you can use to get the bills paid and prevent the situation from happening again.  

Make Your Essential Expenses a Priority 

When finances are tight and you have to choose which bills to cover first, prioritization is key. Make a list of your monthly expenses and put your most essential ones at the top. These are the bills you should cover before any others. Essential expenses might include: 

• Rent, mortgage payments, or other shelter-related expenses 

• Basic transportation 

• Groceries 

• Utilities, water, and electricity bills 

• Child care 

• Cell phone service 

Strategies for Paying Other Bills 

Once you’ve covered essentials and prioritized the rest, consider whether other bills could be negotiated. While you should avoid missing a payment, you may be able to devise different strategies for some bills such as: 

• Car payments 

• Student loan payments 

• Credit card payments 

Some of these strategies may require contacting your lenders to make repayment arrangements. Others could be as simple as cutting out any nonessential expenses for a while to free up more cash. Consider these options: 

• Rather than missing a payment, which could harm your credit score, contact your lenders and ask about a payment deferral or other options. 

• Consider refinancing your debt to secure a lower interest rate. 

• Call your local government to see whether you qualify for any assistance. 

Lean on Your Emergency Fund When Necessary 

If you have an emergency fund already saved up, now may be the time to draw on it. Although it's important to maintain a financial cushion, it's OK to use part of your savings in an actual emergency. Other measures you could try include: 

• If your financial difficulties are due to a layoff, start looking for a new job right away. 

• Avoid taking on additional debt and consider reworking your budget to eliminate burdensome costs instead. 

It's possible to repay your outstanding bills and prevent similar situations in the future by carefully organizing your priorities, paying for essentials first, and, if necessary, leaning on your emergency fund. Take these action steps right away.