Warning Signs
Using credit means that a portion of your current pay cheque must be used to pay back the money you have borrowed. It is very easy to use too much credit and get into financial difficulty. Consider the following questions to determine your "trouble" areas.
If you are in any of these situations, you may be heading for financial difficulties.
- Have you withdrawn from your savings account to meet basic needs, or unable to save at all?
- Would you have to borrow to cope with relatively minor and common financial emergencies such as car or home repairs?
- Are you unable to figure out where your money goes and there always seems to be nothing to show for it?
- Do you avoid opening the mail you think may be bills?
- Have you recently taken out or considered a consolidation loan?
- Are you frequently in overdraft position at the bank?
- Are you only able to pay the minimum amount on charge cards?
- Are you late making payments on bills or skip some months?
- Do you depend on extra income - bonuses, overtime - to pay your monthly expenses?
If you are in any of these situations, you have a financial problem.
- Are you unsure about the total amount of money owed to all of your creditors?
- Are you running to the bank with a deposit so your cheque won't bounce?
- Are you relying in credit cards to purchase items you once paid for in cash?
- Do you use cash advances on your credit cards to pay the rent?
- Have you taken out/considered a second mortgage on your home to meet financial obligations?
- Do you owe money to an average of eight creditors, including department store cards, bank cards, and consumer loans?
- Are you to the limit on most or all of your cards?
- Are you receiving "last notices" on your utility bills?
- Have you been receiving telephone calls from collection agencies threatening court action or garnishee?
