For millions of Americans, an unexpected financial setback can make it feel like your world is caving in around you. If you or a loved one has been affected by a recent setback, it’s important to know that you are not alone and that everything is going to be okay.
GreenPath Financial Wellness offer the steps below to support you in setting a plan for your expenses:
Step 1: List Out and Prioritize Your Expenses
The first thing to do is understand your overall financial situation so you can get an idea of what you need to pay and what you have to work with. Use GreenPath’s budgeting worksheet to list out your expenses and due dates. When prioritizing which bills you should pay first, begin with basic needs (shelter, food, heat, lights).
Once you’ve taken care of yourself, attend to your debts in order of priority. While threats of a low credit score or calls from a debt collector can be intimidating, it’s important to focus on paying down debts with collateral (something that can be taken from you) such as a house or car payment. After your financial setback passes, you can work on catching up with unsecured debts like credit cards, internet, and cable bills.
Step 2: Open Lines of Communication
Talk to your lenders or creditors to see if there is anything you can do regarding upcoming bills. Many utility companies also offer utility payment plans for people with financial hardships.
Step 3: Look for Ways to Generate Cash, And Cut Spending Where Possible
During your financial setback, you can look for ways to earn extra income such as selling unused items, offering ride share services or performing freelance work or odd jobs.
In addition to finding additional sources of money, evaluate your current spending habits to see where you may be able to make adjustments to spend less: set a strategy to save money on groceries, see if you can freeze your gym membership, reduce your cable bill, lower your energy usage, and cut any non-essential spending you can such as entertainment and eating out.
Step 4: Call GreenPath
A nonprofit team of certified financial and housing counselors, GreenPath is here for you. We offer compassionate, judgment-free coaching and can support you to make a plan for the future to ensure you are prepared for life’s curve balls. Call 1-800-550-1961 today.