Consequences of not paying your bills
If you’re in financial trouble and you can't pay all of your bills, it's essential to prioritize. Being late on different kinds of bills will have different consequences. Here are nine things to consider.
- Housing: You can't risk losing your home, but that's exactly what could happen if you ignore your mortgage or rent payment. If you think you may be late, contact your lender or landlord immediately to work out a modified payment plan.
- Car loans/leases: If you don't make your car loan or lease payment, the lender could try to repossess your vehicle. Making this payment is especially important if you need your vehicle for transportation to work.
- Utilities: It will take a few months of unpaid bills before the utilities company shuts off service, but most companies will work with you if you call and explain that you're running into financial trouble. Ask for help before ignoring these bills.
- Student loans: If you have trouble making student loan payments, contact your loan servicer immediately to discuss different relief options. You may qualify for some form of payment relief. And it's important to take action before you incur late fees or your credit is affected!
- Taxes: Ignoring an unpaid tax bill will mean big fines, interest charges and other troubles. If you can't pay, contact the Internal Revenue Service and negotiate a payment plan.
- Credit cards: Paying less than the minimum on your credit cards, or not paying at all, will leave ugly marks on your credit report. If you're struggling, try to negotiate with your credit card company for more favorable terms.
- Medical bills: You should not skip out on these bills. Contact the provider and try to renegotiate a new payment plan before your debt is sent to a collection agency.
- Child support/alimony: These payments are legally binding, and you can face wage garnishment and legal action if you don't pay. First, contact your lawyer, then the court, social services, or your ex-spouse, as necessary.
- Anything non-essential: If you don't pay for gym memberships, clubs, and other non-essentials, you could hurt your credit report and those bills could end up with a collection agency. If you can't meet these payments you can try to cancel memberships or modify the payment plan.