Five Steps to Take If You Can't Pay Your Bills

Lacking the cash to pay your bills is a bad situation, but avoiding the problem is worse.

If money is scarce and bills are coming due, don't panic. Gather your statements and a calculator, and go into planning mode. Tackle the crisis as a whole rather than dealing with issues as they arise, which raises the risk of making poor financial decisions that could affect you for years to come. As you pull yourself together, keep these five crucial steps in mind:

Call the companies you owe: People faced with a budget shortfall will often try to avoid the companies they owe. They simply stop paying without giving a reason. But you should always call your creditors to alert them of your predicament. They might be willing to negotiate a compromise that would resolve the situation. ...