Cutting off price tags and throwing away evidence of your latest shopping spree before the family gets home? Dining on extravagant meals you can’t really afford? When it comes to money, we’ve all done a couple of things we’re not proud of.
But what if it goes a little beyond that? Like racking up credit card debt to go on that Bahamas getaway with your friends? Or taking out a loan without telling your partner? Oops.
The truth is you’re not alone. An April 2022 Paycheck-to-Paycheck report* shows that over the past 12 months, nearly two-thirds of the U.S. population has been living paycheck to paycheck. And of these people living paycheck to paycheck, 22% are having issues paying all their bills.
So, yeah, everything is not fine — and trying to keep it on the down-low isn’t going to fix it. Here are our best tips for digging yourself out of your secret financial trouble.
- 1 1. Have an Open and Honest Conversation
- 2 2. Assess the Financial Damage
- 3 3. Stop Paying Your Credit Card Company
- 4 4. Budget, Budget, Budget. Sorry, But You Have to Create a Budget
- 5 5. Cancel Forgotten Subscriptions and See if You Can Save $720 This Year
- 6 6. Set Up an Emergency Fund
- 7 7. Work with a Financial Counselor
1. Have an Open and Honest Conversation
You may have noticed it’s a lot easier to talk to strangers about your money problems — hey, we’re glad you found us! But when it comes to sharing with friends and family, we’re all at least a little afraid of being judged.
You don’t have to tell everyone you know, but no matter how awkward, it’s essential to have those tough money conversations with the people your financial mistakes may impact.
Why? You know why. If you want your most important relationships to be successful, you need to be willing to have open and honest conversations. After all, the people who love you the most are also going to be the best at giving you the support you need while also holding you accountable.
And for what it’s worth, in a 2021 survey on financial infidelity, 20% of people who were impacted by a partner’s financial deception said that after it was all said and done, they were able to grow closer because of it.**
2. Assess the Financial Damage
One of the toughest parts about getting into financial trouble is simply knowing where to start to get out of it.
Which of your credit cards are carrying a balance? Is your name attached to any unpaid loans? Are you behind on medical or utility bills you didn’t know about?
That’s where a free website like Credit Sesame can help. It takes about 90 seconds to sign up and access your free credit score. From there, Credit Sesame will outline your debt — exactly what you owe and to whom — and offer personalized recommendations. It’ll even break down the interest rates and minimum monthly payments attached to your bills.
Armed with this intel, you’ll be able to more easily devise your payoff plan. You can continue to use Credit Sesame to keep track of your progress and hold yourself accountable. And, you might even feel waves of relief watching your credit score react to all your hard work!
It takes 90 seconds to get started with Credit Sesame.
3. Stop Paying Your Credit Card Company
If you have credit card debt, you know. The anxiety, the interest rates, the fear you’re never going to escape… not to mention the shame you might feel about keeping it a secret.
On top of that, you realize your credit card company doesn’t really care. It’s just getting rich by ripping you off with high interest rates — some up to 36%. But a website called AmOne wants to help.
If you owe your credit card companies $50,000 or less, AmOne will match you with a low-interest loan you can use to pay off every single one of your balances.
The benefit? You’ll be left with one bill to pay each month. And because personal loans have lower interest rates (AmOne rates start at 2.49% APR), you’ll get out of debt that much faster. Plus: No credit card payment this month.
You don’t need a perfect credit score to get a loan — and comparing your options won’t affect your score at all. Plus, AmOne keeps your information confidential and secure, which is probably why after 20 years in business, it still has an A+ rating with the Better Business Bureau.
It takes less than a minute and just 10 questions to see what loans you qualify for — you don’t even need to enter your Social Security number. You do need to give AmOne a real phone number in order to qualify, but don’t worry — they won’t spam you with phone calls.
4. Budget, Budget, Budget. Sorry, But You Have to Create a Budget
If you’re serious about cleaning up your financial act, you’ll need to create a budget. Budgeting is no fun. We know. But it’s important to take a good look at where you’re spending and where you can cut back. Plus, sticking to your budget will help you build healthy money habits that keep you out of trouble.
If you’re not sure where to even start, we favor the 50/20/30 budgeting method for its simplicity. Here’s how it works:
- 50% of your income goes toward essentials.
- 20% goes toward financial goals.
- 30% goes toward personal spending.
The key is to accept you can’t create the perfect budget in an hour. You’ll have to be flexible and experiment to find what works best for you.
5. Cancel Forgotten Subscriptions and See if You Can Save $720 This Year
The easiest and fastest way to cut out unnecessary spending is by nailing down all those sneaky monthly recurring payments you didn’t even know you had.
Keeping track of your subscription services can feel like a game of whack-a-mole. Just when you think you’ve got a handle on them all, another random charge pops up on your bank statement.
It’s easy to let it slide — $5 here, $10 there. But it can seriously add up. Luckily, an app called Rocket Money can show you exactly where you’re wasting money on forgotten subscriptions and bills that are overcharging you. It saves the average person $720 a year.
Rocket Money helps you find and cancel things like unused streaming subscriptions and expired free trials, and they’ll also negotiate lower monthly rates with your internet company, phone company and other bills — for the same service.
Rocket Money has already saved users more than $245 million, and it uses Plaid to make sure all your sensitive information is safe. The app does all the heavy lifting. All you have to do is sign off on these money-saving changes.
It takes just a few minutes to get started and see how much you could save this year. Just register an account and link your bank account, then sit back while Rocket Money goes to work.
6. Set Up an Emergency Fund
Saving up at least $1,000 in an emergency fund is a great idea if you want to avoid money problems in the future.
And here’s the deal: If you’re not using Aspiration’s debit card, you’re missing out on extra cash. And who doesn’t want extra cash right now?
Yep. When you sign up for a debit card called Aspiration, you could get up to 5% back when you swipe at certain stores — plus they give you up to 50 times the normal national interest rate on your savings balance.
It’s perfect for earning extra cash for things that are already on your shopping list. You were going to buy these things anyway — why not get this extra money in the process?
This card used to have a huge waiting list, but now you can sign up for free.
Just enter your email address here and link your bank account to see how much extra cash you can get with your free Aspiration account. And don’t worry. Your money is FDIC insured and under a military-grade encryption. That’s nerd talk for “this is totally safe.”
7. Work with a Financial Counselor
If you’re still feeling completely overwhelmed by the situation you’re in, maybe it’s time to try a financial counselor.
Sure, your regular therapist could tell you why you’re hiding money problems. But an accredited financial counselor (AFC) can do the same thing, plus get you on the path to financial wellness. You’ve got this!
The Aspiration Spend & Save Accounts are cash management accounts offered through Aspiration Financial, LLC, a registered broker-dealer, Member FINRA/SIPC, and a subsidiary of Aspiration Partners, Inc. (“Aspiration”). Aspiration is not a bank.