Do you consider yourself to be good with money? Are you proud that you’ve never paid for anything in installments or taken out a single line of credit? These are all great indicators that you’ve got your financial head screwed on right.
Unfortunately, as experts like National Debt Relief CEO Alex Kleyner know all too well, debt is an issue with many faces. In fact, by actively listening to people’s stories, he’s seen that it has a habit of creeping up, even on those of us who have always tread carefully.
You see, actively taking out credit isn’t the only way to debt. Keep on reading as we consider two ways debt can creep up on you despite your best efforts, and what you can do about them.
# 1 – Sudden Medical Emergencies
Did you know that 137 million Americans are currently struggling with medical debt? In fact, this is the leading cause of bankruptcy in the country. Worst of all, this is the kind of debt that can hit you all at once, when you’re least expecting it.
After all, no one plans to have an accident or get ill. Yet, it only takes one wrong move in the car, and you may well wake up in a hospital bed having already received treatments that have buried your finances in the biggest pile of debt imaginable.
Now, obviously, taking out a comprehensive health insurance plan is a first step towards making sure this kind of debt never lands at your door. If you do end up facing hospital bills without insurance, remember that hospitals want to be paid sooner rather than later. More often than not, you’ll be able to arrange a payment plan or pay a lump sum that’s as low as 50% of the total.
# 2 – Vouching for Someone Else
You have complete control over how you manage your money, but the same simply isn’t true of your friends and family. Yet, there may come times when you need to financially vouch for those people, for instance, when they’re getting a mortgage or buying a big-ticket item on finance. And if they then fail to meet those payments, that debt will fall on you.
Obviously, the best way to avoid this is to be exacting about who you sign for. If things do go wrong, then we’ll be honest; the best thing is almost always to take those payments on your own back for at least a temporary term. That way, you can avoid penalties or snowballing interest, and you can also protect your credit rating. Then, you’ll be in a far better position to get your finances back on track without too much trouble once the primary borrower takes back the reins.
It can feel undeniably unfair to face debt when you’ve always been careful, and the frustrating thing about these setbacks is that they’re ultimately out of your control. But keep calm, remember your financial savvy, and never forget that there are debt relief programs out there should you need them.
