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Short on your bills? Here’s how to prioritize

It’s no secret that many Americans are struggling with their bills right now. Since about 28% people in this country operate without any kind of emergency savings, missing even one paycheck can make it impossible for them to pay all of their bills.

If you have more bills than you have money right now, here are some ideas on how to prioritize your needs:

  1. Food and medication: These are the No. 1 essentials that your family needs. You can cut costs by shopping at discount stores, using generic brands and eliminating any extras, but these should always be your first expense.
  2. Utilities: You can’t survive long without the basics. Heat, electric and water service are essentials. Try to negotiate a reduced payment with your service providers or ask if there’s assistance available before you pay, however.
  3. Rent/mortgage: Shelter is a big expense for most people, but you should generally put this higher on your list than many other debts. If you can negotiate a break with your landlord or mortgage provider, do it. If not, paying the bill will keep you in a stable position.
  4. Car payment: If you have a car in the first place, the odds are good that you need it to get back and forth to work and run errands. Contact the loan provider and see if you can negotiate a skipped payment (which will get tacked on the end of your loan instead), whenever possible.

The least important debts that you have are usually medical payments (hospital bills) and credit card payments or other unsecured loans.

Knowing your priorities can help you keep a calm head when you’re faced with these kinds of difficult decisions. If you find that you’re completely overwhelmed with your debts, it may be time to discuss bankruptcy.