by : Gabriel B. Avalos

In one 2004 survey, 63 percent of Americans said that debt was making their home lives unhappy. The online survey of 5,000 consumers by the Consolidated Credit Counseling Services, a nonprofit money management organization found that:

43% reported a debt-to-income ratio of 50 percent or more.

58% reported that their credit cards were at or near the maximum credit limit.

62% reported of not having a savings account.

92% reported of not having emergency funds for three months of living expenses.

37% reported having taken cash advances from one card to pay the other.

59% reported of paying only the minimum amount due on credit cards each month.

Stress can also be related to the financial decisions one makes, such as spending more than one has, ignoring bills, writing bad checks and going over credit limits, just to name a few. These behaviors often lead to repossessions, higher late fees, harassment from creditors, job loss or even bankruptcy.  We all heard the medical connection stress has to illness. If you get stressed, often times sickness follows. Ask any doctor about their patients and you’ll find more times than not, stress is the key factor to the patients illness. Anyone who has gotten sick prior to or after a big test, deadline or interview knows how stress can wear us down.

Warning Signs of Debt Trouble

If you answer “YES" to any one of the following questions, you are probably in or headed for debt trouble.

• Are your credit cards maxed out?
• Have you use one card to pay another?
• Are you making only the minimum payments each month?
• Have you skipped paying certain bills each month?
• Have you taken out a debt consolidation loan? Are you considering one?
• Have you borrowed money or have used a credit card to pay for groceries, utilities, or other basic needs?
• Have you bounced checks?
• Do your monthly loan and credit card payments, excluding your mortgage exceed 30 percent of your take home pay?
• Are collection agencies calling and or writing you?
• If you lost your job, would you immediately have trouble making ends meet?

As soon as it becomes clear to you that you’re going to have trouble paying your bills, write to your creditors or call them immediately. Explain the problem – accident, job layoff, emergency expenses for your child or other family member, etc.  Don’t run away from your financial problems. You can settle accounts, negotiate payments and even limit collection activities if you make an honest effort to address these issues.