Many people don’t know they are flirting with financial ruin until it’s too late. They only realize that they are in deep financial trouble when they are already in it. There is a fine line between financial health and insolvency. Don’t wait for things to become worse and worse. Don’t wait for the time that you hit rock bottom before you start doing something about the situation. Knowing the tell-tale signs is a vital step of the process. So here are the eight signs that indicate you’re heading for a financial fall.
1. Juggling Bills
This is the most common sign that you’re on the wrong side of the financial scale. If you juggle your bills and often pay the bills late, or if you are living from one paycheck to another, then you must start looking for ways to earn more.
2. Future Payoff
Depending on a future payoff such as getting an inheritance is a dangerous habit. Some people acquire debts or spend way more than they can afford because they rely on money they don’t have yet. This is a habit you should break.
3. Credit Card Debt
Credit cards per se are not bad. However, when you depend a lot on credit cards, that’s where the real problem kicks in. It’s easy to spend when you’re carrying credit cards. You end up buying things you don’t actually need. Before you know it, you are already drowning in debt.
4. Fight Over Money
It’s normal for couples, at some points in their marital life, to fight over money. But if such fights happen often, it’s a sign that you’re in deep financial distress.
5. Overdraft Fees
Regularly incurring overdraft fees on your checking account is another sign that you’re in a brink of heading towards financial ruin. This is something you must not take lightly.
6. No Savings
Is your savings rate a zero? You need to think twice about your financial plan. Not being able to set aside small amounts for the “savings” is a sign that you are struggling financially, though you may not be aware of it yet.
7. Retirement Funds
If you borrow from retirement funds to cover your present expenses, then you are on the wrong track. This is a common sign that a person is falling towards financial distress.
8. Home Equity
Relying on “home equity” to get by financially is a bad habit to break. This is even more dangerous if you do it out of “want,” and not because of “need.”
If you have seen all of these eight signs or some of them, it may be time to seek help or advice from an attorney experienced in settling debt to see if debt negotiation is right for you. Any reputable attorney will provide you with a free initial consultation to go over your situation to see if it’s a good fit for your situation.