Prioritizing the Basics

November 2nd, 2009, byMichelle Singletary


Q: I lost my job and haven’t worked for 8 months. Most of my savings is gone. How do I prioritize my bills, house note and car payment? What is more important? What can you do if creditors give no slack to regular payments?

A Visitor, Upper Marlboro, Maryland

A: I don’t have to tell you the awful unemployment numbers.

It’s bad out there for a lot of people. I’m working one-on-one with several people who are unemployed, and often, after speaking with them, I want to cry. (Sometimes I do.)

At this point, you are in crisis mode. What gets paid are just the basic necessities. You have to have a roof over your head; so of course, keep paying your mortgage as best you can.

Set aside money for food and keeping up the insurance on your car and the car note. Now, on this last point, if you aren’t upside down on your car—meaning you owe on it more than it’s worth—consider selling it and taking any profit you make and buy a hoopty. The goal is to get rid of the monthly car payment. If you are upside down, which many car owners are, then you may have to tough that out.

You have to keep on the utilities. But you don’t have to have cable, or at least drop down to the smallest package they have, especially if it helps you keep your Internet service, which can be key to your job search.

If you have a cell phone, drop that plan to the lowest minutes possible.

And, my friend, that is about it—roof, food and utilities. Everybody else has to wait.

At this point, all other creditors have to get in a line and wait until you are bringing in enough to pay them what, admittedly, they are owed. No doubt they may threaten you with a lawsuit, or they will likely report your delinquency to the credit bureaus. But really, so what? You don’t have enough money to go around. You don’t have a job for them to attach any wages.

If your creditors aren’t willing to work with you to reduce your payments, or they won’t grant you a forbearance until you are back up on your feet financially, then politely and respectfully tell them they just have to wait.

  • Clint Flournoy

    I can relate but, i’m not out there that far. I’ve been unemployed over a year now and work in the Telecom industry, well what’s left of it anyway. I have back child support, back taxes, an outstanding student loan i’ve been paying on since 1987 and am receiving UI benefits. After they take child support out of my UI benefits, i’ve got $840 left, my rent is $1000 monthly, i have a 15yr old car to maintain and insure, i have to buy groceries of course and i haven’t even discussed bills. Let me add to that, i have no health care and haven’t been to see a doctor in almost 6 years, i don’t even know what that is anymore! How i’ve been able to stay afloat is by the grace of God alone, it has to be! I worked for Metro PCS, where i was promised i become permanent like everyone else who worked there after 6 mos. When they told me this would happen, i said to myself, “I’ll believe it when i see it!” Low and behold, after 180 of excellent service, they didn’t know what their budget for the next year looked like and they walked me! I’m also African American so, you know what i thought! Then they called me back 2 mos later for a 1 month project that turned into 2. I was grateful for that but, they can never make me into a “believer” again! I’m not at liberty to tell you how i make it and i’m too dumb to rob and too scared to steal, so much for that! It’ll take more than an act from Obama to restore my faith in this country anymore because, other than God whose keep me strong through all of this, physically and mentally, i just don’t have much faith and trust in anything anymore so, i know how you feel!
    May the peace and blessings that only God can bring be with you.

Last modified: April 27, 2011 at 3:26 pm