We all fall on hard times. It might be due to the loss of a job or an emergency that eats up all our paycheck. Whatever the cause, you may find that you can’t pay your credit card bill.
Don’t panic. While this may feel scary and leave you feeling helpless, there are things you can do. Let’s look at what to do if you can’t pay your credit card bill.
Dip Into Savings
If you have an emergency fund, you may need to dip into it to pay off a creditor. Be sure to keep a small amount in your emergency fund (at the minimum $1,000) to cover any emergencies that may come up before you can build your savings back up.
Unless you're worried about losing your home, you likely don't want to pull money from your retirement accounts (unless you're 59 ½) since you'll end up paying a 10% penalty on top of the amount of tax from your tax bracket.
Pick Up Extra Hours at Work
If possible, pick up extra hours at work or start doing work on the side. Working a few extra hours here and there will give you more than enough money to make the minimum payment that month. You can put any extra in the bank just in case the next month is just as bad. While paying minimum payments isn’t ideal, it’s better than skipping your payment.
Thanks to Facebook yard sale groups, you can quickly and easily sell those items laying around your house collecting dust. This is a great way to make to make some extra cash. It’s only a temporary fix, but great if you’re going through a temporary situation.
Call Your Creditor
One of the worst things you can do is just stick your head in the sand and pretend this isn’t happening. This will lead to late payment fees, a hit to your credit score, and more. What you want to do is contact your creditor and explain your situation. In many cases, the creditor will lower your payment for that month. Some will even allow you to skip that month’s payment.
Not being able to pay your credit card bill can be overwhelming but there are so many options for making that payment.