5 Signs That You're Financially Overextended
A lot has changed in the past few months, including how people are earning and spending money. Are you keeping track of your spending? Don't risk coming up short at the end of the month! Read on to learn the warning signs — and what you can do right now to get back on track.
You're Spending More on Utilities
Working from home, eating all your meals at home, and exercising at home is the new normal. This also means that you are using more electricity, water, and gas. Although some of this is unavoidable — like running the dishwasher more often, or turning on the sprinkler to entertain the kids — there are some things you can do to reduce or spread out the increased costs. Many utility companies give advice on how to make your home more energy efficient, offer fixed-rate billing, and more. You can follow these tips to reduce your energy use, and maybe even your monthly bill. Here's how:
- AHFC: Save Money by Saving Energy
- Tips for Lowering Your Electric Bill
- Information about Free Internet Access with GCI
Your Credit Card Debt Is Going Up, Not Down
When you're worried about having money in the bank, you might be tempted to just put it on the card. However, when faced with paying rent and utilities, often the credit card payment gets put off until the next month. In the long run, this will not only increase your debt, it will negatively impact your overall credit. A great deal on a brand new grill you can pay off in two years might be tempting now, but not if it means late fees and a lower credit score down the line. Take a look at your credit card charges — do you need to reprioritize your spending, get help with payments, or understand how credit works? Here's how:
- The Cost of a Bad Credit Score
- Free Credit Reports Supported by Federal Law
- Credit Card Payment Relief
Your Unemployment Benefits Or COVID-19 Stimulus Check Are Quickly Disappearing
While many people have rainy day funds or savings accounts, it is more common to not have these financial buffers. When you do receive funds to help make ends meet, it might be difficult to decide what to use them for. Without keeping track of where you're spending this money, you might find that it's not going as far as you think it should. Stay on top of what is coming in from these new sources, and where it's going. Here's how:
- AHFC Guide to Economic Impact Payment
- Where to Get Financial Help During the COVID-19 Crisis
- 4 Steps to Spending Your Stimulus Check Wisely
You're Considering Taking Money Out Of Your IRA To Cover Expenses Or Debt
Did you know that withdrawing funds from an IRA or other retirement account often carries stiff financial penalties? Although you might be tempted to take out money to pay off debt, cover general expenses, or pay rent, it may not be worth it. Be sure to contact a representative of your IRA to discuss the details and consider other options. For example, if you're worried about making your student loan payment or having enough for rent, you may be eligible for debt relief or reduced rent. Here's how:
You're Worried About Making Your Rent/Mortgage Payment
If any of the above warning signs are true for you, it might be difficult to make your next rent or mortgage payment. Now is the time to prioritize your spending and set aside what you'll need to keep your housing secure. Review your monthly budget to see where your spending might have changed last month. It might be a large amount, like a higher credit card payment or utility bill. But don't forget to add up those smaller expenses, such as a new subscription to on-demand movies or online shopping — these can really add up! Make sure that you're not spending more in certain areas of your budget than you had planned. Here's how:
For more helpful resources on this topic, please visit Financial Resources and Your Housing.
If you are worried about your housing situation and in need of immediate assistance, please contact Alaska 2-1-1. It’s free, confidential and available in many languages.