We’ve all experienced that overwhelming feeling when you get a bill in the mail but you have zero idea how you’re going to pay it. For some, this is a monthly occurrence. For others, this only happens once a while. But no matter what the situation, it’s a scary and stressful experience to have.

The ultimate goal is financial freedom, but when we can’t even pay our monthly bills it’s pretty much impossible to truly get ahead which could lead to a horrible cycle of poverty that will seem entirely inescapable.

This blog post is a really important one for me, I really wanted to write this. And I really want to do it well because I know that having this experience is horrendous and if I can help even one person from ever having to go through this again, then all of this will have been worth it.

So today, I’m going to talk about some steps you must take in order to stop being behind on your bills and some tips to ensure that it will never happen to you again. Let’s dig in!

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What To Do When You’re Behind On Your Bills

1 // Figure Out Where You Stand Financially

Before you even start to think about actionable steps to take so you can get back on top of your finances, you must first understand exactly where you stand. This means everything. You need to known your credit score, your debt totals, your monthly bill totals, and so much more.

It’s so important to know where your money is going, because there’s no way you can help yourself unless you actually understand where the big problems are.

The first thing you should do, is write down all of your debt. Every. Single. Dollar. Even if you owe your Uncle Jim a dollar that you borrowed in 1999, write that down. You must know everything that you need to pay.

Next, write down your monthly recurring bill payments that you have. This would include mortgage/rent, utilities, car payment, insurance, etc.

*We’ll talk later about cutting some of those expenses down, because that’s definitely going to happen if you’re taking this seriously. 

Finally, you should take note of your credit score. It may not seem like an important factor right now, but it really is. A great way to stay motivated to be better with money is to actually see changes, and as you start to pay your bills on time and in full, you’ll see your credit score improve drastically!

2 // Start Budgeting

For most people who are behind on their bills, the main problem is that they don’t have a budget or a plan for their money. I know that budgeting doesn’t sound like the most fun experience in the world, but it is the single most helpful thing you can do for your finances and it isn’t even that hard to get going.

If you’ve never created a budget before, I highly suggest you go read about the Zero-Based Budgeting Method. It’s simple, easy to use, and leaves no wiggle room for confusion.

Please, don’t go into your first budget with a negative mindset. If you go into this thinking that a budget will be miserable and restrictive, then you will find ways to make your experience feel that way.

You need to go into this experience thinking about how a budget is just a plan for your money. It is a way to make your money work for you, instead of you working for your money. A budget helps you to prioritize what is actually important, and to leave the unimportant behind.

Having a budget will help you know when to pay what bills and how much each payment needs to be, so it’s vitally important to you being able to get yourself back on track.

3 // Track All Your Expenses… For a Month

There are a huge number of people who say they’re broke and can’t afford their bills who throw away money every single day. If you’re the type of person who can’t pay their bills but also buys Starbucks every single day, it’s a spending problem that needs to be dealt with!

This is why before you do anything, you should track every single penny you spend for an entire month. Don’t change any of your habits… yet. Spend money like you normally would for 30 days and see exactly where each of your pennies go.

4 // Decrease Your Expenses

Now that you’ve spent a month tracking your expenses, it’s time to cut in every single place that you can. Sounds fun… right?

The first thing you should do, is give some of your bill companies a call and see if there’s any way to get your bill lower. The first one you should call is your cell phone company, because they are usually willing to decrease your bill without having to ask too many questions.

After you’ve gotten a few bills lowered, you should see where you spend money that isn’t necessary. Are you eating out a lot? Fast Food? Coffee? All of that should be cut out until you’re in a better financial place. I’m not saying you never get to buy McDonalds or Starbucks again, but it’ll be a little while before you should spend money on that.

Essentially, what you’re going to do is create a Bare Bones Budget, which is the absolute minimum amount of money you have to spend each month just to get by. It’s a great way to decrease your expenses to only the necessities and get rid of all the stuff that’s throwing your money away.

5 // Call Companies When You Can’t Pay

One of the worst things you can do when you don’t have enough money to cover a bill is to just ignore it and not pay without telling anyone. It may not work every time, but you have the ability to call the company and ask for an extension and most companies will do that for you.

Companies don’t want you to miss payments, they just want their money without having to chase you for it. If you call them and just let them know that you’re experiencing some hardship, they’ll usually be more than willing to let you have a few more days or weeks to pay.

Please, be nice to the person on the line. You’re asking for a favour in this situation. They don’t have to give you an extension, they’d be doing you a solid, so try not to attack them!

6 // Make More Money

What’s the best thing to do when you don’t have enough money? Try and make more! You have a couple options here, you can ask for a raise, get a part-time job, sell your stuff, or start a side hustle.

I highly suggest the first step to making more money should be to sell as much of your unwanted junk as possible. Having more stuff just leads to more problems like needing to spend money on organizing tools and we are trying to get you to get ahead on bills and save money!

We have an entire page here on Not Quite an Adult that has our best content for Making Money that you can check out. Also, if you’re interested in starting a blog, I have an entire second website that’s dedicated to teaching people how to start money making blogs and you can read how to do it in The Ultimate Guide to Starting a Blog!

7 // Stop Using Credit Immediately

Sometimes I feel like this should go without saying, but for some people it just doesn’t click. Using credit is never a good idea unless you’re good at handling credit cards and know the risks that are associated with credit cards.

If you’re unable to pay your bills, credit cards can be a very slippery slope that you shouldn’t be willing to die on. Try your best to only use credit in case of absolute, dire emergencies but if you’re following Not Quite an Adult closely you’ll know that I suggest you have at least a $1,000 Emergency Fund ready for those moments.

However, if you’re reading this you probably don’t have an emergency fund ready so you can use your credit cards for those emergency situations, but never for another purpose, please.

8 // Don’t Give Up

Not being able to pay your bills is scary, stressful and just downright embarrassing, but it’s important to not give up. Focus on making small, incremental changes to your situation and eventually those changes will add up and you’ll be in a much better situation even just a few weeks from now.

If you feel like nothing can go right and you’ll never be out of this situation, please email me (taylor@sixfiguresideincome.com) and I’ll try my best to talk you through some of your options and what I think you should do next.

As always, thank you so much for reading! If you want to hear more from me every week, you can subscribe to my weekly newsletter below!