If you’re here to learn how to get caught up on bills, you’re in the right place. Showing interest in getting caught up is the first step. Often the response is to give up.

What I’m going to share with you today is a plan.  A plan that will get you out of debt faster.  A plan that will allow you to see the light at the end of the tunnel.

Seeing that light is a great feeling. No longer do you feel hopeless.

But keep in mind, a plan without action won’t get you out of debt. A plan with action will change your future.

So do one thing today. You won’t regret it.

How To Get Caught Up On Bills When You’re Behind

Step #1: Calculate Income & Expenses

Your first step is to calculate the gap between your income and expenses.

Look at what you spent and made last month. You don’t need to go overboard with your budgeting categories.

Get an idea of what you spent in the major categories.

  • Rent or Mortgage
  • Utilities
  • Food
  • Transportation
  • Insurance
  • Medical
  • Debt Payments
  • Everything Else

Your expenses are going to be greater than your income. It’s easy to want to make your situation look better then it is but you don’t have to show this to anyone. Get as close as possible to the actual gap between your income and expenses.

Resource: Free personal budget planner 

Step #2: Prepare a Net Worth Statement

Next step is to prepare a statement of your assets and liabilities.

Similar to the budget you prepared above, it’s easy to flub the numbers here. Be as accurate as possible, it’s only going to help.

Make sure to add overdue bills to your liabilities (which would be under installment debts).

Resource: Free Net Worth Template

Step #3: Make Sure To Check Your Credit Report For All Debt

You may think you know who you owe money to but that’s not always the case. That’s especially true if some of your outstanding debts are older (6+ months) and have been sold by creditors to collection agencies.

That’s why you don’t want to skip this step.

If you want to see who you owe money to — the best method is to check your credit report.

This doesn’t have to cost any money.

I use a free website/app called Credit Sesame which along with a host of other benefits, allows me to see which debts are listed on my credit report (read our Credit Sesame review). Each debt will be broken down into balance, payment, and interest rate. Which will come in handy when you’re completing the below spreadsheet.

Learn more about Credit Sesame.

Resource: Debt Reduction Spreadsheet

Step #4: EMERGENCY Frugality

If you can’t pay your bills, what you’re in is an EMERGENCY. You can’t keep going down this same path. Something needs to change.

Paying $100 a month to stream TV into your home isn’t an option. Neither is paying $4 for a coffee or $7 for a burrito bowl. (If you want those things, realize that you’re cheating yourself out of them by paying interest payments). 

If you HAD to start spending less then you made, what would you do?

You’d probably do something along the lines of:

  • Cut transportation expenses by walking or riding your bike everywhere and maybe even selling a car
  • Not pay for a gym membership
  • Be eating rice, bean, and ramen noodles each night (See: Top Cash Back Apps For Groceries: Apps That Pay You For Your Receipts)
  • Stop paying for cable and learn to use the library
  • Stop buying clothing, unless it’s absolutely necessary for a job interview
  • Negotiate anything you can
  • Lower your cell phone bill

So, write down a list of what you would do if you HAD to lower your expenses. If you’re having trouble, here’s a list of 100 ways to cut expenses.

One helpful tip, which I do myself, is to use Trim. Trim makes it easy to organize and cancel any of your subscriptions. It gets you money back on past purchases. And it will even negotiate bills on your behalf.

You can sign-up for free.

The more aggressive you are with cutting expenses, the greater the benefits.

Step #5: Prioritize

House, utilities, the cheapest transportation possible for work and food. Those are your top priorities. Those bills must be paid.

Just because a bill collector is calling, doesn’t mean you should prioritize that bill. Put yourself and your family first here.

Step #6:  Make An Income Plan

You need to attack your situation both from an income and expense standpoint.

Your next job is to make a plan for increasing your income.

Use urgency here. Ask yourself if you had to make an extra $500 this month, what would you do?

Depending on your situation, your options here are to:

  • Sell anything you can do without on sites like Craigslist
  • Pick up extra hours at work
  • Look for a job that pays more
  • Get a second job
  • Do odd jobs for family and friends

Online surveys are another way to make money fast. There are dozens of legitimate companies that pay you for completing surveys.

Here are three legitimate survey companies you can start with:

  • SwagBucks  – In total, Swagbucks has paid out over $300 million in rewards. You get a $5 bonus just for signing up.
  • MyPoints – Founded in 1996, they’ve paid out over $236 million in cash and rewards.
  • SurveyJunkie – With over 5,000,000 members, SurveyJunkie is one of the largest survey sites. They have an 8.9/10 rating on TrustPilot, which is highest among survey companies.

Step #7:  Communicate

While the initial reaction is to hide from your creditors, that’s not a long-term option. Eventually, you must make them go away.

Your best chance of doing that is being proactive and communicating with them. Don’t wait until they call you. The more aggressive service people are typically the ones making outbound calls. 

Call each of your creditors and ask about your options. Tell them about your situation.

You’d be surprised that a lot of positive things may happen when you reach out. Don’t be afraid to ask if they can cut the interest rate or even eliminate late fees. Some may even put your balance on hold on your account.

After you call all your creditors, update your debt reduction spreadsheet.

Step #8: Pay Off Those Debts

Now it’s time to put everything together.

  1. Your first priority is to pay your necessary expenses (Meanwhile, you’re doing everything you can to earn a side income).
  2. Your next priority is to get current on all your bills by making the minimum payments
  3. Once you’re current on all bills. Organize them by smallest to lowest balance. Any money that’s leftover, you want going toward the smallest. This is known as the debt snowball method.

Summary: How To Get Caught Up On Bills When You’re Behind

This process might take a few months or even a year but don’t stop. Eventually, if you continue to cut expenses, increase your income, and prioritize your debts, one day you’ll not only be caught up on your bills and out of debt, you’ll be quickly accumulating wealth.


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