11 Tips for Dealing with a Financial Crisis

11 Tips for Dealing with a Financial Crisis

Erika Krull

The thought of checking the mailbox fills you with dread. You don’t answer your phone anymore because it could be someone collecting money. Bills are past due and your bank account looks scary. Your gut is constantly tied in a knot.

As time ticks off the clock, your bills keep piling up, and you’ve already missed a few due dates. You don’t want to panic and make things worse, but you don’t know where to start. You need a plan, and fast.

You may feel completely overwhelmed now, and that is OK. You can make this better one step at a time. The following tips will show you how to to get organized and tackle the money beast right away. Gather your courage and let’s get started.

1. Learn to calm yourself

Your ability to make sound decisions right now is vital, and that can only happen if you can calm your nerves. A financial crisis is stressful, so learning to relax is essential to this process.

Start with a simple breathing exercise. Slowly breathe in for four counts and breathe out for eight counts. Do this several times in a row. Once your body gets used to this, your heart rate will slow down. Doing this several times a day will help you lower your stress levels.

2. Gather your financial information

When you are in a calm state of mind, gather all your bank statements, bills, and your calendar. Call your bank or look online at your current balance and pending transactions. You need to know exactly how much money you have available right now.

Write all the due dates of your bills on your calendar or a list. This process will help you know what bills are coming up soonest and exactly when they are due. You are laying down the foundation of your financial situation here, so be thorough.

3. Prioritize your bills and expenses

Now that you know what’s due, list your bills in order of highest priority. You need to keep a roof over your head, basic utilities going, and food on the table. These are your basic needs, and you need to cover those expenses first.

You may have bills due right away that don’t cover a basic need. Before you pay that bill, you need to understand how far you can stretch your money on more important things.

4. Get a simple plan

Start with a simple plan so you can start taking action. Breathe and calm down, then decide which bills you can and need to pay first.

Look at your bank balance and when you get paid again. How does your available cash match up with the due dates of your most important bills? Do you have enough to cover those bills on time, or do you need to figure something out? If you’re short, you may need to get some extra cash to make ends meet.

5. Stop spending money

Stop spending money until you know which expenses are the most important. You must stop the bleeding quickly so you can keep your basic needs covered. This can be a difficult choice, especially if your income has taken a hit. Take some deep breaths, think, then spend your money wisely.

Look through your bank statement for automated payments or renewals coming up. These can be easily missed and can spend your cash when you aren’t expecting it.

6. Action instead of distraction

When stress builds up, you’ll feel like distracting yourself and procrastinating. Distraction can be a good stress reliever, but not in this case. You need a focused mind to make the situation better. Once you have a basic plan of attack, do what’s needed to cover your bills. Take the action you need even if it goes against your emotions.

Many things will require your attention as you work through this situation. Unplanned expenses will come up, something will break, or a bill you’d forgotten about will come in the mail. Keep figuring out your plan and stay on track.

7. Lower your bills

Once you’ve prioritized your bills, contact each business to see if there’s a way to lower your payments. Call your credit card companies about lowering your interest rate or fees. This can also work with mortgage companies, your landlord, and utility companies.

These businesses would prefer that you pay some or most of your bill instead of nothing. Negotiation can take some heat off your bills as you start to catch up.

8. Trim extra expenses

Start trimming the fat out of your list of expenses. This is a great time to cut cable, drop subscriptions, and stop eating out. Go back to your definition of essential purchases and question everything you usually spend money on.

Don’t worry, you can find plenty of ways to enjoy life while cutting costs. Instead of streaming movies with a paid service, see what you can watch for free. Buy generic brands, cook at home and use your local library.

9. Make some extra cash

Now that you’ve cut expenses, put more money in the pot by finding a side gig or two. First, sell your unused items on Craigslist or local selling exchange Facebook groups. Hold a yard sale with a friend or two to draw a big crowd. Have a special skill you can use? Sell your services locally and online as a freelancer.

Search newspapers and online listings for part-time work. Grocery stores, discount stores, and restaurants are always hiring. Ask your friends and family if they know anyone who’s hiring. Do odd jobs like yard work, scooping snow, or walking dogs.

10. Speak to someone you trust for support

Remember how closely tied your money and emotions are? Don’t go through this stressful journey on your own. Get some support right away from a person you trust. They don’t have to be an expert with money, but you need someone with a financial track record in your corner.

One of their most important jobs will give you emotional support. When you feel like giving up or get frustrated, they can help you settle down and think clearly.

11. Be honest with your family

Don’t sugarcoat this situation with your family. This won’t be fun, but be honest from the start. You need everyone on board with your financial plan for it to work. Explain the problem and potential consequences if your situation gets worse. Tell everyone in the family how spending and saving will change for everyone.

Then turn the mood in a positive direction and promote a family team attitude. Describe your goals and what everyone can do to help. These changes most likely won’t last forever, but it could feel that way at first. Once everyone knows how to pitch in, it’ll be easier to stay focused and motivated.

Climbing out of the hole

Getting out of a financial crisis is no picnic, but it is manageable. Stay calm and make a plan. Take action every day to meet your goal and have your support network by your side. You and your family are in this crisis and can get through it together.


For more tips on relationships, follow Family Bridges on social media @familybridges

5 Steps to Tell if Something is Really Worth Spending Money on

5 Steps to Tell if Something is Really Worth Spending Money on

Contributed by
Sarah Pichardo

Do you lay awake at night wondering if a purchase is worth it? Like do you really need it or is it going to make its way into someone else’s home via Goodwill. Let’s take the guesswork out of it. Here are five handy-dandy steps to follow in order to find out if something is really worth it.

Step 1: Sing Missy Elliot’s Song, “Is it Worth it”

Is it worth it? Let me work it. I put thing down flip it and reverse it.

Step 2: Ask Yourself, Is it Worth it?

Now that you have that song stuck in your head, keep asking yourself, is it really worth it?

Step 3: Talk to your Bank Account

Hey, money talks so talk back to it. How does your wallet feel about this expenditure? Do you even have money in your wallet or is it begging for mercy?

Step 4: Talk to your Spouse or Phone a Friend

Talk to your spouse about it. Especially if it’s a major purchase where you’ll be spending money from a joint account. Let’s not start World War 3 in your house cause you didn’t communicate. Not worth it. Not married? Phone a friend. Tell ‘em your hopes and dreams. What do they think? Also, make sure you phone the responsible friend not the crazy one. You know which one I’m talking about.

Step 5: Ask Yourself, What Would Abuelita Do?

Your abuelita is a smart woman. She pays in cash and thinks credit cards are for necios. And, si no tienes el dinero, no lo compres. (If you don’t have the money, don’t spend it). Please refer to Step 3.


You did it. You went through all 5 steps. Pour yourself a glass a wine. Now make a decision. If it’s really worth it, your spouse is cool with it, you have the money and your abuelita gives you a thumbs up, then you should be good to go. If not, then it’s probably not worth it.

You’re still here? Still don’t know if you should buy it? Use this flowchart:


Budgeting for a Baby

Budgeting for a Baby

Contributed by
Freddie Beckley

Congratulations – you’re having a baby! Now get to work! … Just kidding. You may only have a few short months to get ready for that bundle of joy, but this time should be fun, pleasant and downright enjoyable. Not just for you and your spouse, but for the baby too. Studies have shown that newborns are heavily affected by their parents’ stress levels. Even when they’re in the womb, a baby can hear what’s happening around them, and you don’t want them to hear you arguing or stressing. So, with the emotional wellbeing of your child in mind, below is a list of easy things you can do to alleviate one of the most stressful parts of being a parent – finances.

1. Wait before Buying in Bulk

When my wife and I were preparing our home for baby, we wanted to have enough of everything. We didn’t want to be without baby Tylenol or a thermometer or a diaper in the middle of the night when we needed it most. As a result, we bought a lot of things up front, and we had to donate or get rid of some of it. A great example of this is the pacifier. We bought about a dozen and were gifted another dozen more. The only problem is, our baby doesn’t use a pacifier. Oh well, at least we have little baby shower gifts for our friends over the next few years…

Bottom line: there are certain staples that will never expire and you can never have enough of, for instance baby wipes or formula, but a lot of items are time sensitive. Diapers and clothes, for example, won’t always fit. Be wary of overbuying every little item just because you want to feel prepared. Buy enough for the first month, and then once you have a better sense of your needs, continue to shop.


2.  Bottle it Up

We were concerned that our baby wouldn’t take a bottle unless it was the exact right shape and size, so we bought about 9 different types. This wasn’t a bad idea, but it was a little overkill. We’ve come to find that our daughter doesn’t care what kind of bottle she drinks from, and we actually prefer the cheapest one on the market because it fits with my wife’s breast pump.
Bottom line: grab a few different kinds of bottles to be safe, but wait to see what your child prefers before buying more.


3. Learn to Share

I was SO excited to become a dad that I started stocking up on my gear immediately. I bought my own diaper bag and filled it with blankets, a changing pad, baby shampoo, ointments, etc. My wife did the same, and now we have 2 fully-stocked diaper bags. This sounds good in theory but, since we don’t have twins, we only ever take 1 diaper bag out at a time. The other one sits at home.
Bottom line – communicate with your partner to share the essentials. You don’t need 2 of everything.


4. Shop Early and Shop Often

My wife is brilliant. Let me tell you why. She started shopping for clothes as soon as we got pregnant, up to 12 months. When our daughter was born, she had all the shirts, pants, onesies, mittens, hats, jackets, sweaters, socks, and swimsuits she would need until her first birthday. Because we spaced it out over 9 months, we only shopped in the clearance sections of baby stores. Did you know winter outfits are 60-90% off in the Spring? Now you do.

Bottom line – Go ahead and buy the clearance clothes 6-12 months early and not only will they be much cheaper, but chances are your baby will be the only one with that cute Christmas outfit since they stopped making it. #win

P.S. Look online for items too. We buy formula and baby wipes in bulk online and end up saving a pretty penny.


5. Find the Free

I looked it up, and the number one financial regret of newborn parents is wasting money on toys and presents the baby can’t appreciate. Avoid the same mistake! If you want to give your baby a 6-month birthday present, give them a box. If you want your baby to have an awesome experience, don’t take them to Disneyland. Take them to the park. It’s free.

Bottom line – find all the free things you can and live it up with baby. Many libraries and bookstores have story time. A place in our neighborhood offers a free music class for babies. As your children grow up, they may want more and more expensive things. Enjoy this sweet time when they have no idea what’s going on.


6. Baby Swap

Not that you don’t love your baby, but there will come a night when you and your spouse need a night out. When that time comes, don’t waste money on a babysitter. Find a friend or family member you trust to watch your child for a few hours. It’s even better if they have a baby themselves. That’s why I like to set up Baby Swaps. Take turns with other parent couples watching each others’ babies. When you and your spouse are watching your friends’ baby, your baby will get to work on their social skills. When you and your spouse want to go on a date, you’ll be more comfortable leaving your baby with a trusted friend than a hired hand.

Bottom line: babies always seem to come in waves. In the last year, 8 of my close friends have become pregnant. Find those friends with a child about the same age as yours and ask if they want to trade off with you.

What’s been your experience when budgeting for a new baby? Share your experience in the comments section!

For more tips on finances and relationships, follow us on social media @familybridges.

The Credit Card Debt Payoff for Beginners

The Credit Card Debt Payoff for Beginners

Contributed by
Melanie Lockert from brightpeak financial

Want to pay off your credit card debt? Learn more about the six steps you need to take to become financially free.
It might have started off innocently enough: charge a little here, charge a little there — and suddenly you find yourself deep in credit card debt. What seemed small and manageable has become an overwhelming burden. If you’re feeling stuck in credit card debt, you’re not alone. In fact, U.S. citizens owe a total of $747 billion in credit card debt according to a recent Federal Reserve report. 

Luckily, there is a way out. Here’s the credit card payoff plan for beginners.

 Step 1: Know what you owe

Denial is a powerful factor when it comes to debt, but to get out of debt, you have to face the numbers, no matter how gruesome they are. Log into all of your credit card accounts and tally up the total. Write down the final balance on a piece of paper and keep it in your wallet. Post it on your bathroom mirror. Facing the facts can be tough, but you need to see the numbers to create a plan.

Step 2: Check your interest rates

Interest is what makes paying back debt a pain. It’s the extra fee charged for the convenience of borrowing money. Credit card interest rates may vary, but typically they can be fairly high. If you have multiple credit card balances, write down your interest rates next to your total balance for each loan. It’ll come in handy with the next step.

Step 3: Choose a debt repayment strategy

After tallying your total balance and knowing the interest rates on your credit cards, it’s time to choose a debt repayment strategy. There are two tested methods that can help.

The debt avalanche method focuses on paying off the highest interest debt first. During this time, you pay the minimum on your other credit card balances. This strategy saves money on interest, but it may take longer to chip away at the balance.

The debt snowball method pays off your smallest balance first, while paying the minimum on the rest. This method is effective as it offers quick wins and doses of motivation at the start. The downside is you could pay more in interest.

Step 4: Calculate how much you can really put toward debt

The minimum payment on your credit card can be a trap. After all, it’s just the minimum, which makes it hard to climb out of debt. If you’re serious about tackling credit card debt, look at your income and expenses to see if there is any wiggle room to cut back. For example, consider reducing some of the “wants” in your budgets like going out for lunch or overpriced movie dates. If you prioritize paying off credit card debt over everything else, how much can you realistically put toward debt each month, while still paying your bills? You want to create a plan that helps you get out of debt faster, while also managing your day-to-day expenses.

Step 5: Earn more money

Cutting back on your expenses is a great initial strategy, but to overhaul your progress, you also want to focus on earning more money. This can help you become debt-free sooner. Consider getting a job on nights and weekends. Using the sharing economy, there are many ways to quickly earn more money. Let your friends and family know you are willing to help out and that you’re looking for gigs. Ask for a raise at work. Adjust your tax withholding if you typically get a tax refund. There are many ways to earn more — the key is to get started.

Step 6: Put the credit cards away

The solution to your problem isn’t the thing that created the problem. In other words, you don’t want to use credit cards while you are trying to pay off credit card debt. It’s too easy to get back into bad habits rather than focus on paying off balances. Put the credit cards away and start using cash and a debit card. This can help you spend what you have and detox off of credit.

You can do it

Using these six steps, you can eliminate credit card debt. It’s not an easy task, and one with a lot of ups and downs, but it’s totally doable. Once you’re debt-free, your money will be yours and your hard work will pay dividends. Ready to get started? Download our Illuminate app to rock your budget and pay down debt.

This post is originally from brightpeak financial, an organization that helps couples and families get on track financially.  You can read the original post here.

Reasons to Refinance

Reasons to Refinance

Contributed by
Ashley Reed

What kind of debt do you have? Car loans, student loans, mortgage? If you have any of the above, chances are that you can shorten your loan period and decrease your total payment to your lender by refinancing!

Refinancing helps you out by reducing your interest rate and the total amount that you pay towards your loan.

An example: Let’s say that you buy a car for $15,000 with a 7% interest rate, with a loan term of five years. If you don’t refinance, you will end up paying a total of $17,821 towards the vehicle, which is over two thousand dollars more than what you originally paid for it! Let’s say that after one year paying 7% interest, you have put $3,564 towards the principal and interest of your auto loan. You still have $11,436 due, and want to lower the amount that you pay towards interest. So you refinance your  loan and secure a 2% interest rate. With this new interest rate, you will end up paying a total of $11,909 towards your remaining loan.

Let me break it down visually:

Original Loan

7% Interest Rate

$15,000 Loan

5 Year Term

If you stick to the same loan term and interest rate, you will pay $17,281 for your car over the course of five years.

Let’s say that you stick with the loan for one year, paying $3,564 towards the balance and interest. You then decide to refinance the remaining $11,436 that you owe on your car.

Refinanced Loan

2% Interest Rate

$11,436 Refinanced Loan

4 Year Term

If you add what you paid towards your car during the first year to the refinanced loan balance and interest paid over the course of four years, you will have paid a total of $15,473 towards your car! If you didn’t refinance, you would have paid almost two thousand dollars more for your car; that is enough extra cash to take a nice weekend vacation!

If you aren’t sure how your interest adds to your balance over it, check out Credit Karma’s loan calculator.

Have you ever refinanced a loan before? Share your experience in the comments section!

For more tips on finances and relationships, follow us on social media @familybridges.

How Values-Based Budgeting Changed our Relationship

How Values-Based Budgeting Changed our Relationship

Contributed by
Diana Kerr from brightpeak financial

Do you have a hard time agreeing on spending priorities, or getting on the same page? For some couples, values-based budgeting can help. Here’s one story.

Brian and Nicole Crangle, both 29, have big goals for their finances. Together, the Orlando pair have focused on values-based budgeting to help achieve those goals.Values-based budgeting is the idea that how you spend reflects your values. Those values could include starting a family, traveling, tithing, going debt-free — there’s a host of values to focus on. Instead of, say, relying solely on the advice of a single financial advisor, the goal for couples on value-based budgeting is to assess what values are important to them, and then budget accordingly.

The early years

Brian and Nicole are working on growing their own business Victory Development, a mentorship and leadership development program. Brian also works in admissions for a flight school, while Nicole works in leasing for an apartment community.

They married in 2013, and settled into financial habits without much thought. They owned their home and splurged on conveniences such as a home delivery dry cleaning service. Nicole had student loan debt, but they kept up with the monthly payments and didn’t worry about it paying it off faster.

A couple years into their marriage, some friends introduced them to values-based budgeting. Brian and Nicole admired the intentional life their friends had built and decided to give it a shot. The couple started by identifying their values and goals: Leave their jobs to work on their business, have a family, make an impact, and pursue freedom in time and finances.

What they changed

With their values in mind, the Crangles decided to spend less in many areas and more in a few strategic areas.

Brian cancelled his dry-cleaning service, and Nicole traded expensive salon visits for $20 haircuts and at-home manicures with $2 nail polish. Nicole asks for clothes for her birthday and avoids the mall unless she needs something specific.

It’s not always comfortable or convenient, they say. However, they’re able to allocate more money for giving, savings, debt repayment, and expenses they value.

Opportunities to grow themselves and their business are a top priority for them. For example, they recently attended a leadership conference, opting to spend the money they used to spend on groceries on the conference instead. Nicole’s also investing in a personal trainer because she values her health.

The couple’s budget changes as their life changes. They record each purchase and check in weekly to see how they’re doing or make adjustments.

How their relationship changed

Brian and Nicole are enthusiastic about values-based budgeting because they say it’s changed nearly every aspect of their lives.

They say they now get excited about money and fight less because they agree on how they want to prioritize their spending. They’ve learned how to work together, communicate well, and navigate tough conversations about how to reach their long-term and short-term goals.

And, Nicole is leaving her full-time job soon to focus on their business, thanks to their budgeting.

Start the values conversation today in your own marriage today. For help, check out the tools from TogetherTM, brightpeak’s financial platform designed just for couples.

This post is originally from brightpeak financial, an organization that helps couples and families get on track financially.  You can read the original post here.

The Sky is the Limit!

The Sky is the Limit!

Contributed by
Omaira Gonzalez

Bills, bills, and more bills kept coming with no money to pay them. My husband was barely making minimum wage and hardly spoke any English. I was pregnant with my first child and was not working at the time. We lived in a tiny studio apartment and our kitchen was the size of a closet. Many times I didn’t know whether we would have enough money to buy groceries or even some milk. Those were some real tough times.

Things eventually started to look up for us, I found a good job and my husband was doing great at his job. Both of us were making good money. However, our family kept growing and so did their needs. To keep up with the growing demands, we used credit cards.  We would use one credit card, then pay it off with another credit card that offered 0% interest for a period of time. It became a vicious cycle and instead of having any financial freedom we were over our heads in debt.  We were working two to three jobs just to make ends meet and help put our kids through college.  This burden of debt caused sleepless nights, worry, anxiety, stress, fear, and health issues.

One day we made a decision to finally get our finances in order. I admit it was hard and required a lot of discipline. We made a plan, created a budget and started to tell our money where to go. We began to get a grip on our finances until little by little we finally became debt free.

It took some time to get out of the mess we had gotten ourselves into. Yet we were determined to climb out of the hole we had dug ourselves into. This process required both my husband and I to work together.  We started being more careful about how we spent money and what we spent it on. Any purchases we made had to align to our budget and financial goals. We only made purchases with cash and we saved for vacations and major expenses. We didn’t spend what we didn’t have.  We are now in a situation where we have financial stability and get to do things we have always wanted to do. The best part is that we have been able to increase our contributions to others and to organizations that make a difference. My husband and I are more connected today than we have been before, and know that we can make our dreams become reality when we work together.

What did I learn from this experience? It started with a simple decision…I wanted to be debt free. Then together with my husband we began a budget and a plan.

Don’t get discouraged during the tough first months, trust me it does get better. Do not give up when you get frustrated because changing old habits and behaviors takes time. Allow some room for growth and do not expect things to change overnight.

Here are a few financial tips I have learned.

  1. Create a budget (include all your expenses)
  2. Balance your checkbook
  3. Stop using credit cards… cut them up. Save for big purchases and pay in cash
  4. Have an emergency savings fund… this will help with those unexpected expenses that normally we would go to a credit card for. If you have the money saved you don’t need the credit card.

Of course there are many more tips but this is a good start.  Remember a little hard work and discipline will get you where you want to be – Financially free!!!!

For more tips and ideas on how to take control of your finances, or other articles about relationships, follow us on social media @familybridges!

For more blogs, tips and articles on kindness or relationships, follow us on social media as @familybridges.