What To Do When You Can Barely Make Your Mortgage Payments

In this article, Barry Kloogh talks about what actions you can take to alleviate the pressure caused by barely being able to stay on top of your monthly bills.

Financial difficulties are everywhere. They are all around us. People experience them every day. They can have a very negative impact on our lives, and they can cause a lot of worry, stress, and anxiety. But one of the crucial things to understand about financial difficulty is that it only comes about when we make decisions that create it.

In my book The Money Cookbook, I make a statement in the summary that I believe applies to this topic rather well.

“An unfortunate fact is that our education systems don't teach our children how to manage money. Ironically though, the people who succeed in life are the ones who make it a study after school. The people who stop their education before learning how to handle money are the ones who end up dead broke or dead before their expected lifespan. And finances and investment don't necessarily have to be intense college courses. People like you, just need to find a guide, like a mentor or a financial advisor, who can supply them with the foundational education so that they can find the best tools for themselves.”

In consulting with clients through my Debt Breaker program (www.debtbreaker.co.nz), I have come to realize that every situation is different. In fact, being a financial advisor might be as much about doing background research and knowing the client as it is about knowing mathematics and finances. And if there is one thing that is for sure, it is that financial difficulty is much more likely to occur when you do not make a budget and regularly compare your spending to it.

Why is a budget important?

Most people put together a guesstimate-type budget at some point or another. In fact, some people even put quite a bit of thought into their financial allotments. They get out the calculator, build a budget spreadsheet, and make sure to double check everything. The only problem is that most people don’t regularly compare their spending to their budget to see if there are any inconsistencies… and the failure to do this can lead to a multitude of problems!

So what do you do when you can barely make your mortgage payments? What is the first step towards gaining financial independence, and how can you aspire to achieve freedom from debt without falling behind?

These are great questions. First of all, it never hurts to meet with a financial advisor… so that might be a great first step.

Otherwise, the first thing that you need to do is to look at your income and plan a budget for expenditures. Once you plan your budget, make sure to regularly check your spending against what you have planned, and make sure to remedy any inconsistencies. Controlling your spending is much easier when you are constantly scrutinizing it, and a budget is a great tool for keeping your own spending in check.

Financial difficulties almost always occur when money is being wasted somewhere, and putting together a budget is a great way to spot waste before it gets out of hand. If you can eliminate waste and find a way to only spend what you can afford in the different categories on your budget, then you should quickly see more money made available for crucial bills and payments.