6 Ways to Manage Your Finances When in a Crisis #Polk Advisors

If you’re facing a sudden hardship — like a divorce, injury or job loss — asking for financial help can stress you out more.

But the choices you make during this time could leave you dealing with long-term financial consequences.

If you’re experiencing a financial hardship and aren’t sure how you’re going to pay your bills, there are ways to avoid debt.

6 Ways to Avoid Debt During a Crisis

1. Budget for a Lower Income

If you are used to a higher income, the sudden lowering of income could cause real problems when it comes to figuring out how to cover your bills.

Consider this a time to budget.

You can find out  where you are financially by writing down your current income and expenses down. Continue on to the next steps to figure out how to lower payments.

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If you own a business, find a trusted business advisor who can help identify areas for improvement and opportunities for savings during this time.

2. Enroll in a Credit Card Hardship Program

Did you know that credit card companies can adjust your payment schedule or even stop paying your bill if you’re experiencing temporary financial issues.

A credit card hardship program is basically a payment plan for your credit card.

Programs vary by lender, so find out about the terms and explain why you need temporary relief. It’s a better way to not end up under a mountain of credit card debt on the other side.

3. Ask for Help With Bills

An unexpected medical bill or home repair can be a burden to pay. There are programs that can help if you’re unable to pay a bill due to unforeseen circumstances. One is an organization called Modest Needs.

This non-profit provides small grants to individuals who would otherwise be capable of paying their expenses.

4. Find a Side Gig

5. Negotiate Medical Bills

When you find yourself in over your head with medical bills, it can be financially draining.  Stop procrastinating, calculate what you can afford and negotiate with your provider. Don’t think that healthcare institutions are out to intimidate you and take all your money. They are willing to work with you and most will accept less than what you owe.

6. Set Up a Plan for Your Student Loans

Federal student loans can follow you until death. You don’t want to default on a student loan — the government can collect on the debt by garnishing your wages or income tax return refunds.

Don’t worry if you lose your income, because you can ask for a break.

These steps can give you the necessary breathing room after a tragedy to get back on track.