Friday, March 16, 2012

Which Bills Should I Pay First?


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]


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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