10 Warning Signs of Financial Crisis

couple struggling with financesMost personal financial crises take years to become something as serious as a bankruptcy or foreclosure.

When you have a clearer understanding of your crisis, you’ll have a clearer understanding of what you need to do to fix it. 

“While economies can collapse seemingly without warning, a personal debt crisis doesn't happen overnight,” said Brian O’Connell, a writer for Main St.

The good news is you can keep any temporary financial problems from becoming serious by watching out for the warning signs.

It may be time to reevaluate your budget if:

  1. More than 20% of your income goes towards loan payments.
  2. You have to borrow money or charge your credit card to pay off current loans or bills.
  3. You cannot pay your basic living expenses with one job.
  4. You have to pay bills late, or choose which bills to pay.
  5. Your emergency fund is nonexistent.
  6. Your credit cards are maxed out.
  7. You pay only the minimum balance on your credit cards.
  8. You’re spending more than your credit card limit.
  9. You consistently take more money of out your checking account than you have.
  10. You don’t have any money left over after paying monthly bills.

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You may already be at this point. This does not mean it’s time to give up! According to Credit.com, there are three steps to taking control of your finances when you find yourself in a crisis:

    1. Evaluate your situation.
      Figure out how much money you owe and who you owe it to. When you have a clearer understanding of your crisis, you’ll have a clearer understanding of what you need to do to fix it. If you have debt, talk to the lender or creditor about payment plans and options.
    2. Investigate your options.
      Depending on what type of financial crisis you’re having (i.e. unemployment, major illness, inability to pay bills) there are different options to either avoid going into debt or paying off the debt you already have. For example, if you can’t pay your monthly utility bill, maybe all you need to do is borrow money from a family member for a couple of weeks. But if you’re unemployed, your solution may involve applying for unemployment and taking out a small loan to cover expenses until you find a new job.
    3. Take action.
      Once you know what you need to do, do it!

Usually, if you’re in debt (or about to be) the problem will not resolve itself. Whether you decide you need to take out a loan, borrow money from a family member, figure out a payment plan, or simply reduce your expenses, stick to your plan once you come up with it.


What do you think?

10 Warning Signs of Financial Crisis

Tell us what you think!


  1. Profile photo of Ivonne Ivonne says:

    It is a good article. Now if we can stick to saving, then things would be smoother. However, bills never leave us.

  2. Profile photo of Kay Kay says:

    Great article, very good tips!

  3. Profile photo of LIZ says:

    Very nice article its hard in this times to mantain a budget but we try to do our best

  4. Profile photo of Kristen Kristen says:

    Student loans are bringing us down

  5. Profile photo of mommy nhoj mommy nhoj says:

    This is a nice article to read. I am really trying to take the best out of me since I take on a new responsibility, a full-time housewife. And my husband mostly let me do the math! Thanks for sharing!

    • Profile photo of nancyk nancyk says:

      Good luck! We are trying to change things in our own household so that I can stay home with the kids, and it’s a very scary decision to make. Wish me luck, too! 😉

  6. Profile photo of Timothy Timothy says:

    we have a butt load of money and really don’t worry about money

  7. Profile photo of Michelle Michelle says:

    This is an informative article, though probably read too late for my family. We are having the hardest time financially right now. Bad credit, one income that does not cover the bills, borrowing and taking out loans… it is over-whelming, to say the least. I’m a stay-at-home mother with three in the home, a full time online college student, and have my own health issues but no insurance. We do what we have to with what we have, then give the rest to God.

  8. Profile photo of Kayla Kayla says:

    I imagine, if you have student loans, probably more than 20% of your income probably goes to loan payments – especially if you didn’t get an amazing job straight out of college. 🙁

  9. Profile photo of Jesse Jesse says:

    money, money, money,

  10. Profile photo of Great Mom Great Mom says:

    we try not to spend on the credit card

  11. Profile photo of jasmineking jasmineking says:

    my best friend’s mom makes $77 every hour on the computer. She has been without a job for 9 months but last month her check was $14382 just working on the computer for a few hours. her latest blog…….WWW.Rush64.COM

  12. Profile photo of Grace Grace says:

    2,3,4,5,9, and 10 in the 1st half all apply to us….. no credit cards but 1 might idk because my spouse is the one who keeps taking out loans… bottom part done one, 2 no options but keep on troggin… 3 yeah okay we are taking action he has 3 jobs i’m looking for 1, children in childcare for me to work… i think i will get a call back to start work Wednesday……

  13. This economy we live in sux 😛

  14. Profile photo of Miriam Miriam says:

    We just had car issues and are having our second child shortly. I am scared I will not be able to pull through without a break down. I really hate to stress over something we are not able to prevent.

  15. Profile photo of mommy7 mommy7 says:

    we review our budget monthly to help us stay on track and depending what the situation we know what we need to do for the next month.

  16. Profile photo of Hipmom808 Hipmom808 says:

    My husband and I sit down every month together to evaluate our finances and see where our spending is going. In rare cases we will cut unnecessary subscriptions to save us a few bucks and take those few bucks and put them elsewhere. I’d say we are really good at managing our money as a team. I’m a stay at home mom so budgeting is vital to our family.

  17. We really need to work on our budget because I am having our second child and everything is very costly right now.

  18. Profile photo of MissMaris13 MissMaris13 says:

    After college we were struggling to make ends meet. Now a year later we have got things under better control but we still can say yes to some of the above qualifications… I sit down each pay period to ensure each bill is paid on time and I have a predicted budget for future weeks to just give myself a plan for the upcoming paychecks. It’s amazing to visually plan where our money is going.

  19. I think it’s important to sit down look at your budget occasionally anyway, maybe quarterly, just to get an idea of where money is going anyway.

  20. Profile photo of jami jami says:

    I think it is great to really sit down and look at your budget. Even qualifying for 4 (or more) out of those 10 things should be a warning light that things need to change. The hardest step is to admit there is a problem. The second hardest is to find and stick to a way to get out of trouble.

    • Profile photo of Grace Grace says:

      its also hard to get out of a mess once you are in one- we were homeless 10 months- had bad credit card debt/still do but no credit cards- have loan debt — both the loans and cc were used to pay bills, we have no unnessisary bills mind you…. all our debt problems starting at the begining our our marriage- spouse using my cc to pay for his school…. now 7 years later and still struggling to just make ends meat


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