Not having enough income to pay the minimum payment due on your credit card is very stressful. It can easily and quickly happen to anyone, especially if you’ve lost your job, had your hours reduced unexpectedly or fallen ill or had an accident. But, if you simply overspent, and left yourself short on cash at the end of the month, it’s time to change-up your financial routines and address the root of the problem. Finding out why you can’t make the payment is the only way to avoid doing it again.
Right now, you either need to come up with cash to make the payment that’s due or make an arrangement with your credit card company. Next, you can start saving to make next month’s payment and adjust your income and expenses.
Don’t Panic. Instead, Take Control Of The Situation.
While carrying a zero balance is something you should strive for, making payments on time is a top priority now. Take a look a few ideas below on raising some immediate cash and working it out with your credit card company. It’s important to let the credit card company know what is going on so that you minimize the impact of paying late or paying less, on your credit score.
Don’t Skip Payments
If you skip a payment, the credit card company can raise your interest rate to the legal limit, a penalty rate. Depending on the terms of your agreement, you may have to pay this high rate until you pay off the balance completely.
If you already missed a payment, make it up as soon as possible. Generally, if you can still make the payment within 30 days of when it was due, the credit card company will not report it to the credit card bureaus. If you can pay it as soon as possible, you won’t put yourself in the position of having to make a double payment the next month. You’ll likely have a late fee though that will increase your payment.
Pay Your Minimum Payment
Try to do any small job that will pay you enough to make the payment. Babysit, sell items at a consignment store that will pay you up front, return recent store purchases or make a lower payment on another bill if it is possible.
Don’t wait until the due date if you actually have the funds ahead of time. Otherwise, you may end up spending the money on something else, putting you in the same situation on the due date. Make the payment as soon as you can pull the funds together.
Call Your Credit Card Company
You’ll be surprised how often they will allow you to make a smaller payment, extend your due date or lower the interest rate until you can get back on your feet. Often, they will set up automatic payments from your checking account so you don’t need to worry about missing a payment. If you do miss a payment after making an agreement, you may incur extra fees and costs.
If you have a good payment history already, you have a better chance of getting the credit card company to work with you, at least for this month. Let them know how long you’ve been a customer and that you have been responsible in the past. Explain what’s going on in your life that caused this if you’ve lost your job, had medical problems or are going through personal issues.
Help Is Available When You Need It
Once you resolve your current payment crisis, you’ll want to understand why this happened. If you are stressed out each month because you don’t know how you’ll make the next payment, perhaps setting up a meeting with a professional credit counselor can help. Credit counselors can help you work with your credit card companies to set up a lower minimum payment due each month and arrange a long-term plan that lets you reboot your financial life.
The bottom line is that the credit card companies and credit counselors are willing to work with you and help you. Start by calling your own credit card issuer’s phone number listed on the card. Explain that you need to speak to someone because you can’t make your minimum payment. Chances are good that they’ll work with you to help you this month. This allows you the time you need to figure out how you’ll pay next month’s bill.