I like to research and write about a variety of subjects that I find interesting.
What is the Problem?
I'm probably telling you something you already know, Bills are still coming in, but you don't have the money to pay them.
We have been in a pandemic since January, 2020. A pandemic is defined as a .fast-acting infectious disease that is carried from person to person, country to country.. It has affected millions of people.
Back in April, 2020, the unemployment rate was as high as 14.7%. An unemployed person was categized as being out of work 27 weeks or more.
According to Statisa.com, in September, 2020, the unemployment rate in the United States fell to 7.9%. That equaled 12.58 million people.
To put it in perspective, in 1933, the unemployment rate was 24.9%,the highest ever in the United States. That was during the Great Depression (Wikipedia)..
When you have over 12 million people without a job, paying a bill is not necessarily important. But the situation is important.
Pandemic Be Damned
A. Bill collections have not changed because of the pandemic. The invoice statements still come every month.
B. If you are one day late with a monthly payment, even if you have paid on time for over 2 years, they will charge you a late fee. What does that mean? If your monthly payment is $35, and they charge you a $40 late fee, you haven't paid anything on your bill for that month. In fact, you owe an extra $5 for that same month.
C. You make arrangements to pay $5 a month on a $75 bill. If you skip a month, two people may call you looking for the five dollars. The company has spent at least $15 for two people to make a call asking for a $5 payment.
The thought of the creditor is, if you miss a $5 payment one month, skipping future payments will become psychologically easier,
D. Plan on seeing all your late payments show up on your credit report.
What You Can Do
1. Get a copy of your free credit report from all three credit reporting companies. Make any corrections to each credit company. The three credit reporting companies are Equifax, Experian, and TransUnion.
2. Call every company or person you owe and renegotiate new monthly payments. This includes your bank credit cards. Ask for a lower interest rate to decrease your monthly payments.
3. Keep all receipts in a large envelope. This is in case you have to prove you made payments. Do the same if you borrow money from a friend or relative.
4. If you don't have a copy of the companies' invoice showing whatever you owe. ask for another copy.
5. Don't make payments in cash. If you do, make sure you get a receipt.
6. Write down the name of whomever you talk to about your bill, and the day and time you spoke with him.
7. If you feel totally overwhelmed, there are debt counseling companies that will assist you in paying back your bills. They will help to reduce your monthly payments. They will help you reduce interest rates with your creditors. They can also help to consolidate all of your late bill payments into one manageable monthly payment.
If You Borrow Money From a Friend or Relative
That person is now a bill. Unless they specifically tell you that it is a gift, he or she expects to get their money back. If he tells you not to worry about it, you still have to pay back the money. Regardless, put whatever the understanding, in writing, signed by both parties.
If you send cell phone messages back and forth, make a written copy of those notes and agreements as backups. If you buy a new cell phone, you lose whatever information was in the old phone.
Make sure there is a time frame on your agreement of when you have to pay back the borrowed mony.
Why Should I Do All of This?
When you borrow money, be it a friend or a relative, it is a business transaction. Just as owing a bank, credit card, or any other bill. You need to keep all of your receipts of payments paid until all money has been repaid.
Get a receipt back if you pay in cash. Better yet, buy your own receipt book for them to sign. Have the person sign it to acknowledge your cash payments.
The pandemic has not changed obligations to pay back money. With some work, you can get lower monthly payments. You can put current payments due on the back end. You can ask for, and perhaps get, a lower interest rate. It takes some of the pressure off. But you have to ask.
This content is accurate and true to the best of the author’s knowledge and is not meant to substitute for formal and individualized advice from a qualified professional.
© 2020 Carolyn Gibson
Carolyn Gibson (author) from Boston on October 23, 2020:
Thank you. One must keep hopeful during this time.
Hertha David from Windhoek, Namibia on October 22, 2020:
Great information there. It's just sad that some people have lost their source of income.