5 Signs of Financial Trouble
5 warning signs of financial trouble
Here are five red flags that might indicate you are in financial trouble. If any or all of these apply, don’t hesitate to contact us. We are here to help.
Taking out payday loans
There are payday loan businesses in the city, and on television and radio ads. Resist the temptation no matter how tough your situation. These loans high interest rates and payment terms typically put people further in debt. Payday loans are incredibly toxic for your finances. Any time you consider getting one, it is a huge red flag that you are off track financially. While borrowing money from friends and family is also a warning sign of trouble to come, pay day loans are a particularly troubling sign.
Fighting with your spouse about money
People often ignore this sign because they think it is a sign of marital issues, not financial issues. Arguing about money typically means that you are not on the same page with your spouse on financial issues. The deeper you get into financial trouble, the more often people find themselves fighting with their spouse over how to spend to money, who to pay and how to get out of debt.
Paying household bills with your home equity loan or line of credit
Paying your household bills with home equity money won’t show up on your credit report, but it is a sign that you are running out of options. It is an especially bad idea to use your equity to pay credit card debt. Revolving debt, like credit cards, is unsecured, so it is very risky to borrow against a secured loan, such as your mortgage. You might be hounded by bill collectors, but at least you won’t jeopardize your home or car.
If you are routinely overdrawing your account or bouncing checks, then you are most likely either very poorly managing your finances or in serious debt. Bouncing checks does not show up on your credit report, but overdrawn accounts can result in a negative check-writing history report. Such a report can they can impact your ability to open a checking account or purchase car insurance.
Tapping into your retirement fund
Have you dipped into your retirement accounts to pay bills, pay for emergency repairs or some other use? In addition to early withdrawal penalties, you are costing yourself the compound interest you would have earned by leaving the money in the account. If you are even considering using retirement money to pay current bills, it is a sign that you are heading for trouble.
If you are experiencing any or al of these signs of financial trouble, give MCT a call. We will do all we can to help guide you through, and help you see the light at the end of the tunnel.