I just spoke with a client who, like many people in a financial mess, is having trouble paying
all of his debts on time.? One of the things I emphasize is to develop prioritized spending plan each month.
One of the items at the very top of that page should be your housing; rent or mortgage.? My
client is trying to work out a plan to pay his mortgage ahead of things like credit cards and
personal loans since he understands the importance of keeping his home.
The first mortgage is going to be paid on time, but while working in person with a rep from
the bank that owns the second mortgage, one of the things my client was told was to do is to
get a line of credit to help him through the tough times in his business.
Is this guy serious?? I'm afraid so.? In fact, while working through his financial mess, my
clients has talked with about five companies of which he cannot pay the minimum payments to.?
He was offered no less than 4 credit cards in the process!
If you have not yet realized that you cannot borrow your way out of debt, then it is time to
do so.? The bank's best customers are the ones that cannot pay their bills on time.? They get
eaten up with fees and interest charges each month and the banks love them.? Don't fall into
this trap.
If you cannot pay all of your bills, you must prioritize your spending and pay the most
important ones first.? That includes, shelter, food, utilities and so on.? Make a list of what
is important to your family each month and make sure to pay those items first.?
If you want to get out of debt, you must stop borrowing money.? This is a very simple, yet
often overlooked step.? Do you have enough money coming in each month to pay cash (check,
debit card, or actual cash) for your expenses?? You may not even realize how much money it
takes to survive each month.
Stop borrowing money, develop a plan, get
out of debt aggressively!
