Don’t miss the signs of pending financial trouble


People who are in financial distress often don’t realize there is a problem until it is too late. They miss the warning signs and the financial behaviors that might predispose them to big problems. Early detection is key in keeping financial problems from spiraling out of control.
Is financial distress only a concern for the younger generation?
Unfortunately, financial distress can happen at any age if someone has really poor financial behaviors. The financial problems might not develop until there is a major life change such as retirement, change in income or increase in monthly expenses. The older someone is when distress happens, the more difficult it is for them to overcome.
What is an early warning sign of potential financial distress?
One of the very first warning signs is using your credit card to buy everyday items like groceries, coffee or lunch combined with paying only the minimum payment. This typically indicates you have a cash flow problem and you are spending more than you make in a month. 
Are there signs that are missed often?
Two of the biggest signs that trouble is looming is starting to pay bills after the due date and having occasional overdrafts on your checking account.  Many people view these as temporary setbacks rather than a forewarning that they are starting to get overextended. The overdrafts mount and the bills start being over 30 days late.
What are signs the situation is really spiraling out of control?
The biggest is carrying balances on multiple credit cards and using cash advances from one to pay the minimum payment on others.  The second sign that someone is really in trouble is paying all of their loans and other bills every other month which means they are past due on all of their accounts all of the time.
Are there any behaviors that are more likely to lead to financial concerns?
If you are an impulse buyer or spend more than you make each month you will more likely have financial difficulties. Another telling behavior is not using any kind of budget or spending plan. This is the trifecta of financial bad behaviors.
What should a person do if they start seeing signs of financial problems?
First and foremost develop a workable budget or spending plan so that you can avoid adding to the problems.  Next, look at what is causing the most pain for your finances and work to solve that issue, or at least lessen the impact on your monthly financial situation. There could be difficult choices to make including housing and transportation choices if the situation warrants that level of change.

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