When you’re worried that your paycheck won’t
cover your monthly expenses, figuring out which bills you need to pay first can
be tough. While it may be tempting to charge your expenses to your credit card,
adding any debt can make your financial situation worse. Use the following tips
to decide which bills to pay first:
1. Food and Healthcare
You need to eat. Even if it's Ramen and canned
green beans from the dollar store, feeding yourself is important. The same goes
for medical expenses. That old saying, "If you haven't got your health,
you haven't got anything," is true. If you're forced to decide whether to
seek treatment for high blood pressure or make a car payment, your health needs
to come first.[1]
2. Rent/Mortgage
Having somewhere to live is essential. It's the
roof over your head. If you own your home, it can be one of your most valuable
assets. Paying your rent or mortgage should be one of your top priorities. The
loss of your home or eviction from your rental could be a devastating financial
and emotional blow, so pay your rent or mortgage after you pay for food and
healthcare.[2]
3. Car Loan and Car Insurance
If you're one of the millions of Americans that
drives to work, then you know how important your car is. Making your car
payments and paying your monthly insurance bills means you get to keep your car
and drive it responsibly. If you know that you absolutely cannot pay your car
bills, then, if possible, try selling your car. Look into public
transportation, like busses or subways, as alternative forms of transport. If
any of your coworkers live nearby, suggest carpooling. It’s easier on the
environment and your pocket book. [3]
4. Utilities
While you have some leeway with utility bills,
it is important that you keep your lights on and your water running. Normally,
utility companies will allow you to be a few days late for a small fee, but
they will turn off their services if you continue to miss bill payments.[2] The impact of reducing these bills could really help your bank account savings in the long run.
5. Credit Card Bills
Your credit card is the last bill you should
worry about when you're facing more pressing matters -- like paying your rent
or keeping your water running. While you're repaying other bills, try not to
use your credit card or incur other forms of debt.[4] Only after
you've taken care of your basic needs should you begin to repay your credit
card debts. If you’re concerned about how to handle your debts, contact a
nonprofit credit counseling service like the National Foundation for Credit
Counseling.[5]
These suggestions can help you decide which
bills you should pay first. It can be a tough call, depending on where your
priorities lie. If you have a family and a home, your needs may be very
different from an individual renting an apartment. Modify this list to suit
your specific needs, and you’ll find a way to pay your most important bills
first.
About the Author:
Check
'n Go, the fourth largest consumer financial service institution in the United
States, offers online payday loans,
check cashing, and cash advance loans as part of their commitment to ethical
and responsible lending. Check 'n Go has consistently set high standards for
their payday loan and installment loan
services to ensure that their customers continue to have options available for
whatever financial circumstances come their way.
References
1. Kirchheimer, Sid. "In Hard Times, What
Bills Should I Pay First?" AARP. 12 08 2011: n. page. Web. 22 Feb. 2012.
.
2. Lazarony, Lucy. " Paying your bills:
Which to pay first." Bankrate.com. n.d. n. page. Web. 27 Sep. 2011.
.
3. Vohwinkle, Jeremy. "Reader Question: I
Can’t Pay My Bills! What Bills Should I Pay First?" Generation X Finance.
n.d. n. page. Print. .
4. Collins, Frank. "What Debts and Bills
Should You Pay First If You Run out of Money?" Invest It Wisely. n.d. n.
page. Web. 22 Feb. 2012..
5. Zahorsky, Rachel. "Which bills to pay
first: six tips when you can't pay them all." 30 03 2007: n. page. Web. 22
Feb. 2012. .
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