How To Pay Off Bills With No Money: The Definitive Guide
Are you struggling with a cloud of outstanding debt over your head?
If this is true, chances are you are trying to find a solution on how to pay off bills with no money.
Despite being a topic that many people are interested in, it is not something that is discussed in details by many financial bloggers.
And here's the good news:
In this article we will show you the exact step-by-step strategy on how to get back on track.
Believe it or not, taking control of your finances is not as hard as most people make it out to be.
With a proper action plan, you could be on your way to living life debt-free life.
So, you want to learn how to pay your bills with no money?
Let's dive in:
Chapter 1: Understand That Proper Budgeting Is Key To Getting Out Of Debt
Let's face it:
When trying to get ahold of your own personal budget, it is imperative that you take a look at your current budget.
Many people think that they can get by without setting a strict budget.
This is simply not feasible if you are doused in debt.
Think about it:
The reason that you have found yourself in this position is because your spending has exceeded your budget.
Whether you like it or not, you must have a budget for all your expenses.
In essence, if your bills are adding up and you are wondering how you can pay them off, you need to redo your budget.
Here are the reasons budgeting will help you pay off your bills (even with little or no money):
- Stop overspending because you are aware of the amount of money you SHOULD be spending
- Reach your savings goals by budgeting and spending less than your budget
- Gain control of your financial situation by following a strict budget
These posts explain a lot:
- How to Get Out of Debt With the Debt Snowball Plan | Dave Ramsey
- What is Budgeting? What is a Budget? | My Money Coach
- 6 Reasons Why You NEED A Budget | Investopedia
- Reasons Why You Should Budget Your Money | The Balance
Chapter 2: Do A Personal Audit Of Your Finances
There is no argument about whether humans act based on their habits, or based on what's right.
If you are stuck in the habit of going through each day, not being worried about your budget and financial situation, you will find yourself in a great struggle shortly after.
In order to take control of your finances, it's recommend that you do a personal audit of your finances to see where you are today.
Try to answer the following question:
Can you tell me exactly what your monthly spending adds up to on average?
Not able to answer this question?
You NEED to get back on track.
And auditing your personal finances is a big step towards paying off your bills.
Here are a couple quick tips when doing your personal audit:
- Separate and add up your fixed and variable expenses
- Establish a minimum monthly budget for living expenses
- Identify what you can cut out from your life to save money
These articles will teach you how to perform an audit of your finances:
- It's Time for a Personal Audit of Your Frugal Living Budget | The Organic Prepper
- How to Conduct a Personal Financial Audit | Free Fincal
- What Are Your Financial Strengths and Weaknesses? Run a SWOT Analysis | Cash Money Life
- http://www.wikihow.com/Analyze-Your-Current-Finances | Wiki How
- Evaluating Your Personal Financial Statement | Investopedia
Chapter 3: How To Make Money In 24 Hours
There are many opportunities out there that can help you earn quick cash.
Although there is a great deal of information about how to make money quickly, you must tread carefully.
You can find yourself in a trap of 'get rich quick' schemes which will want your payment up front before they teach you how to make money.
Generally, if it sounds too good to be true, it is.
This should not scare you away from performing some tasks in exchange for money.
If you currently have no money saved up, and need to pay off some bills, doing a few odd jobs can help you get some quick cash to pay them off.
In our opinion, here are some of the simplest ways to make money fast:
- Call your family and friends and ask them if they have any short term work for you
- Check the 'gigs' section of Craigslist to see what's out there for short term jobs
- Offer to clean somebody's house or car
- Sell furniture or household items
More great ideas:
- Need Money ASAP? 25 Clever Ways to Earn Cash in the Next Hour | The Penny Hoarder
- How to Earn $100 in a Day Legally Without Investment | One Cent At A Time
- 7 Ways to Make Money in a Day | Cheat Sheet
- 18 Quick Ways to Earn an Extra $100 | The Penny Hoarder
- I Need Money: 20 Legitimate Ways to Make Quick Cash Today | Money Pantry
Chapter 4: Pay Only For Essential Expenses
The simple truth is:
In order to get ahead you are going to have to cut costs across the board.
Earlier in the article we discussed setting your budget. You should have identified all of your bills and essential expenses.
Once you know what your essential living expenses are likely to be month-by-month, you can begin to focus on spending LESS than this number.
For instance, cut out expensive habits like drinking bottled water, eating out, paying interest on credit card bills, and more.
After you cut out these non-essential expenses, you can watch your savings account soar!
Even if you do not have any money right now, you can start saving up by eliminating unnecessary expenses.
And perhaps you can use that money towards paying your bills.
Our favorite articles on this topic:
- How to Create a Bare Bones Budget | The Balance
- What are 'essential living expenses'? | Money Saving Expert
- 30 Frugal Living Tips: Small Changes That Result in Big Savings | The Organic Prepper
- 13 Things you should NEVER pay for | Lauren Greutman
Chapter 5: Renegotiate Student Loans and Medical Bills to Reduce Payments
There's no denying that student loans can literally drain your bank account.
But here's the secret:
You do not have to pay right away.
You have options.
First, you should take a look at your repayment schedule.
If you're working somewhere then you may be considered eligible for deferred payments.
In fact, if student loans are putting a great financial burden on you, some lenders may be willing to work with you.
Besides deferring your payments, there is another option that you can opt for:
You can substantially reduce your monthly repayment, if you are able to come up with a lump sum payment.
Many times, this does not work out for most of us.
But it could be worth a shot, if you are in a position where you can borrow money from somebody.
Medical bills are another story.
After you've racked up medical bills, you may be stuck in a situation where you have no way to afford these bills.
Hospitals and doctors offices are used to dealing with these situations.
Get in touch with the company who you owe money and explain your situation to see if they can come to your rescue.
- Negotiating a settlement on student loans | Bank Rate
- Can I Negotiate the Interest Rates on My Student Loans? | Student Loan Hero
- Settle your student loan debt using this one weird trick | Daily Caller
- How to Negotiate Medical Bills | The Balance
- 7 Smart Ways to Negotiate Your Medical Bills | Time
- 7 Tips For Fighting And Paying A Big Hospital Bill | Forbes
- 5 Expert Tips for Negotiating Your Medical Bills | US News
Chapter 6: Understanding The Consequences of Nonpayment & Prioritize Your Payments
Monthly bills add up quickly.
Sometimes, there are bills which you simply cannot afford to pay on time.
When this happens, what do you do?
The #1 thing that you consider is which bill will have the most negative consequences if you do not pay right away.
Take note of what the potential ramifications could be if you cannot pay the bill by the due date. You must understand the fact that secured loans are much more important than other types of loans.
In short, secured loans could land you in hot water if you continue to not pay.
Remember that there could be serious consequences if you do not pay certain bills.
You may be subject to:
- Vehicle repossession
- Home repossession
- Wage garnishments
- Liens on property or wages
- Loss of power, water, or gas in your home
You can avoid these consequences by choosing to defer payments on bills like your cell phone, internet, or gym membership.
It's always great if you can inform the company you are unable to pay.
Many companies will allow you to pay late without consequence, or at worse you may get dinged a small late fee.
Link to Resources:
- The Consequences of Skipping Monthly Payments | The Balance
- Help! I Can't Pay My Bills. What Should I Do? | Listen Money Matters
- What can happen when you don't pay bills? | Uwex
- 3 Debts to Consider Not Paying Off | Forbes
- What to Do When You Can't Make the Minimum Payments | Dave Ramsey
- When You Can't Pay Your Bills: Ten Things to Know | Nolo
Chapter 7: Talk To Creditors To Negotiate New Payment Plans Or Reduce Payment Amount
Out of many different solutions to get control of your debt, this is probably the most significant.
Like we've explained before, your monthly expenditures need to be less than your monthly cost of living.
But if your bills add up to be higher than your income, how can you possibly save money?
There's still an option:
You can save by getting some of your creditors to lower your monthly payments.
Negotiating lower payment amounts could be, at times, the difference between filing for bankruptcy and NOT filing for bankruptcy.
There are a number of different loans that may allow you to renegotiate monthly payments:
- Mortgages (although not the easiest task)
- Car, boat, motorcycle
- Back taxes (money owed to the IRS)
- Credit cards
- Unsecured Bank Loans
- and more!
These posts will help you become a PRO of negotiating with creditors:
- http://www.nolo.com/legal-encyclopedia/strategies-negotiating-with-creditors.html | Nolo
- https://www.credit.com/debt/ten-tips-for-negotiating-with-creditors/ | Credit
- How to Settle Debts When You Can't Pay Them Back | Life Hacker
- How to Talk to Your Creditors When You Can't Pay Your Bills | College of Aces
Chapter 8: Credit Counseling & Debt Negotiation
There is no secret to managing your finances.
And there's no denying that getting out of debt may not be easy.
In fact, many people cannot find their way out of debt without assistance.
And for those who need a bit of extra mentoring, credit counseling is available in your neighborhood.
Credit counseling agencies essentially provide financial education services so that you can learn about credit, debt, bankruptcy, and more.
If you are struggling to meet your monthly bills consistently then you may benefit from consulting a credit counselor.
A credit counselor will try to fix all of the problems with your credit, and find the best plan of action to reduce monthly payments, consolidate debts, and take control of your finances.
And the best part is credit counseling could potentially be FREE.
Do your research and find out which companies in your city are offering credit counseling for free or rock-bottom prices.
- When Credit Counseling Is (and Isn't) a Good Idea | Nerd Wallet
- 9 Things You Need to Know about Credit Counseling | Green Path
- The Truth About Debt Management | Dave Ramsey
- Consumer Credit Counseling Services | The Balance
- 10 Things You Should Know About Debt Management Programs | Money Under 30
Chapter 9: Consider A Payday Loan - Learn What To Expect
Payday loans might be something that you could have never though of taking a dig at.
Regardless, if you are in a position where a payday loan could help, and it seems logical, then by all means go for it.
Sometimes, you may find yourself in a position where you just need $300 to make it to the next week. A payday loan could solve this issue, and only cost you about $45 out of pocket, assuming a 15% payback fee.
Are you certain that you will have the money to pay them back quickly?
Then a payday loan could be just about right for you.
Learn more about payday loans from these posts:
What do you do when your bills pile up?
You begin changing your spending habits and work on your budget.
In this article we've shared with you several different solutions to help you pay your bills without money.
Financial freedom is not too far away. Once you proactively figure out your exact monthly living expenses, and set a strict budget you are on your way to living a debt-free life.
Now that you are armed with the knowledge, you can take a few deep breaths and start working towards fixing your finances.
You should start following this article as a guide to start living a debt-free life.
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