3 Signs You?re Headed for Financial Trouble

Financial Trouble

9044771759_6a89cc9c60_zWhen it comes to finances, some people just prefer to keep themselves in the dark regarding the true state of their accounts, especially if they are in debt. If you aren?t making enough money to cover all of your expenses, it can be easier to just ignore the problem rather than meeting it head on and finding a solution.

Of course, this is a bad idea ? and can lead to serious problems down the line. Rather than hiding from your money issues, take an honest look at your situation so you can make the tough decisions necessary to get back on track.

Below are three signs that you may be headed for financial trouble. If you notice any of these signs in your own life, be sure to address the issue right away.

Reliance on Credit Cards

This is probably the most common sign that there is financial trouble brewing. While credit cards can be used correctly in a variety of circumstances, you shouldn?t have to rely on them in order to pay your regular monthly bills. If you do, it is likely that you are spending more money than you bring in each month. That reality is a path toward major financial problems in the very near future.

Not only does leaning too heavily on your credit cards mean you will soon be paying interest charges on those accounts, but you will also run out of credit sooner or later. As soon as you notice that you have to lean on credit just to cover your bills each month, stop and take a closer look at your whole financial picture.

Stagnant Wages

Have you been making the same amount of money for a long period of time? The cost of living will gradually increase over time, and if your wages don?t follow suit, you could soon find that you can?t afford the same lifestyle that you had gotten used to.

Keep track of your annual earnings as the years go by and make sure that you are making progress to at least keep up with the cost of living at the very least. If not, you might need to get to work on either obtaining a raise within your current company or finding a new position that pays a better wage.

Lack of Control

People who have very little idea of what is going on in their financial lives are sure to run into problems at one point or another. It is important that you know what your accounts look like and what your expenses look like so you can plan for the future properly.

If you aren?t sure exactly how much money is in the bank, or even how much money you spend on a monthly basis, it will be very difficult to make smart decisions and manage your money wisely. Just like you try to keep your actual house clean and organized, your financial house should be in order as well. There are a variety of tools you can use to take control and monitor your finances – a favorite of mine is Personal Capital as they allow you to manage your finances and track your spending for free.


Have you ever seen any of these signs in your life? What did you do to reverse the trend and get back on track financially? What are some other signs of financial trouble you can think of?



Photo courtesy of: Schwar

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  1. The feeling of reliance of plastic money was the worst feeling for me. I also hated living from paycheck to paycheck. One of the perks of getting your finances back together is never having to wait for a payday. Loving it!

  2. I think #2 is especially important. Too often we focus on cutting back without thinking about how much we’re earning. I think people get comfortable where they are and don’t think about increasing their income.

    • John Schmoll says:

      You’re exactly right Zina. Cutting is one thing, and is needed, but growing your income will take you much farther. If you’re not seeing relatively decent growth in income then something needs to be done.

  3. I have a credit card, but I don’t use it more often and for paying bills. I paid my bills using Digit and happy for this kind of service.

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