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Are You Financially Over-Committed?

Are You Financially Over-Committed?

Signs Indicating You Are Financially Over-Committed?

Edited by Honey B Wackx

For many of us it would be great if we could just save some ten percent of our salary or money like many financial advisers recommend. But it is difficult to do if one is living from paycheck to paycheck.

Do you find yourself rushing from the bank to pay off a payday loan after cashing your paycheck? If you do, don’t feel like you’re the only one doing that. This has become so commonplace that you’ll find these ridiculously high-rate lenders on nearly every street corner.

Just today I heard a similar advertisement for a high-rate lender on the TV and it’s becoming more often on TV than ever before, at least in my area. The pitch on TV about their loan was “Yes, it’s expensive, but much cheaper than a payday loan.”

While all too common, this practice of borrowing between paydays or similar is a sure sign that you’re in deep financial trouble. Many other signs also indicate that you are financially over-committed.

Some Signs You are Over-committed Financially

* Falling behind in your payments to credit card companies and other lenders.

* Using your credit cards to pay for day-to-day necessities such as food and gasoline.

* Taking out a cash loan from one credit card to make the payment on another one or to pay other bills.

* Making the minimum required payments on your credit card bills.

* Refinancing your home to consolidate all of your debts into your regular mortgage payment.

* Borrowing from friends or family just to get by until your next payday. This a sign of serious financial trouble and can also put a strain on precious relationships.

* Taking out a second mortgage on your home to pay off other debts that have gotten out of control.

* Finding yourself needing to get a loan from your 401K to pay off high interest loans and credit card bills. This is a serious mistake. It not only depletes your retirement fund but carries penalties and high taxes from early withdrawals.

* Having little or no savings to fall back on during an emergency or in the event of job loss.

Continued in Part II

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