Millions of people are behind on their bills. In fact, 16% of American adults didn’t have enough money to pay their bills in full as of November 2020. While the high number of layoffs due to the COVID-19 pandemic hasn’t helped, many people struggled to pay their bills even before that.
Unfortunately, there are some serious consequences to not paying your bills. Late or missed payments have a major impact on a person’s credit history. Left unpaid, these accounts could end up in collections, which has an even bigger impact. Meanwhile, falling behind on rent could mean eviction.
Still, if you’ve fallen behind on your bills, there are ways to prevent these from becoming even bigger problems and get back on track. Here are some of the best resources for financial help, and other steps you can take starting today.
Check to see if you’re owed unclaimed money
Approximately one in 10 Americans have unclaimed property. Here are the most common types of unclaimed property, and some of the best ways to find it:
- Stocks and savings bonds (search for matured securities here)
- Money from banks or credit unions (check the SEC for lost investments, FDIC for failed banks, and NCUA for failed credit unions)
- Rent deposit from a prior residence
- Utility deposit
- Life insurance benefits
- Uncashed paychecks from previous employers (contact the Wage and Hour Division)
- Federal tax return or state refund (find your state revenue department or contact the IRS)
- Pensions (contact the PBGC)
- Valuable family heirlooms
- FHA-insured mortgage refund (check hud.gov)
- Bankruptcy funds (find out if you’re owed money from a previously closed bankruptcy case here)
One other way to find unclaimed property is through the National Association of Unclaimed Property Administrators (NAUPA). As the leading authority on unclaimed property, the organization’s main goal is to help people find what is rightfully theirs.
NAUPA operates in all 50 states, Washington D.C., Puerto Rico, Kenya, and some provinces in Canada. NAUPA uses a combination of leadership, business reporting, and education to help find unclaimed property. To date, it has returned more than $3 billion in unclaimed property to people with an average paid claim of $1,780.
Go to their website and search for any unclaimed property. Since NAUPA operates nationwide, your search results are not limited to your state of residence.
If you find any unclaimed property, send in a claim. As long as you can prove the property is yours, you should receive it within about 30 days of filing.
How to get emergency financial help
If you need help with food, utilities, healthcare, housing, or something else, here are some of the best ways to get supplies or money to carry you through the crisis.
Help with food supplies
The Supplemental Nutrition Assistance Program (SNAP) helps individuals and families in need supplement their food budget. Those who qualify will receive an EBT card, which works much like a debit card and can be used at most grocery stores.
SNAP benefits cover the essentials like dairy, meat, fruits, vegetables, bread, and cereal. They do not cover alcohol, vitamins, hot foods, hygiene products, cleaning supplies, or pet food.
To receive SNAP benefits, you must apply either online or via your state’s toll-free hotline. Eligibility varies by state, but most states only offer benefits to those who fall within a certain income limit.
WIC is the Special Supplemental Nutrition Program for Women, Infants, and Children. It’s available to low-income women who are pregnant, breastfeeding, and postpartum but not breastfeeding. It’s also available to children under the age of six who have special dietary needs.
Although WIC is a federal program, eligibility is based on state. To apply for WIC benefits, you’ll need to set up an appointment with a state or local agency. WIC is not meant for long-term assistance, but it can help in cases of emergency.
Once qualified, you’ll receive a WIC card you can use to get certain food items at any participating grocery store.
Child nutrition programs
The USDA offers various child nutrition programs, including:
- National School Lunch Program. This program provides free or low-cost lunches to school-aged children.
- Summer Food Service Program. Through this program, children and teenagers in low-income areas receive free, nutritious meals.
- Child and Adult Care Food Program. This program is available to both children and adults who are enrolled in certain facilities (ex. adult daycares and child care centers).
Other child nutrition programs are designed to educate organizations and members of the community. Some programs also supplement existing financial aid programs. These programs are designed to ensure children get nutritious meals that help them grow and develop in a healthy way. They also help reduce the risk of food insecurity.
Eligibility requirements, as well as benefits, vary based on program and state. To determine your eligibility, contact the Food and Nutrition Service here.
Food pantries get food from food banks or donations. Once they have the food, they deliver it to low-income areas to keep residents from going hungry. With higher rates of unemployment, food pantries are an essential part of many communities.
There are several ways to find local food pantries, including:
- Local churches or other religious establishments
Food pantries do have certain limitations. For example, many of them run on donations. Others may not have much in the way of pet food or baby formula. In some cases, you may be able to choose the food you need. In others, you may receive a pre-filled bag with essential foods. Eligibility is based on personal needs rather than a predetermined set of requirements.
Soup kitchens, or meal centers, offer nutritious meals to low-income individuals. Typically, local churches, non-profits, and government organizations operate soup kitchens with volunteers giving out the meals. As with food pantries, eligibility is based on personal need.
There are many soup kitchens, so the best way to find one is through a quick online search. Some non-profits, like The Salvation Army, also run local meal centers.
Help with utilities
Your utility company
If you need help paying utility bills, check with your utility company first. They may be able to offer you some assistance in the form of a payment extension or grace period. Some utility companies also help people who can’t get heat or water, particularly during times of crisis.
Besides that, many utility companies run their own programs, which are designed to help those in need. Some of these programs work by reducing expenses such as the cost of heating during winter, while others help people pay their utility deposits.
Check with local utility companies to see what they can do for you.
Backed by federal funding, Lifeline helps low-income families by reducing the cost of their internet or phone bill each month. Eligibility is based on income, but individuals who already participate in another government program like SNAP may qualify automatically. Either apply directly through their website or contact your utility company to apply on your behalf.
Low Income Home Energy Assistance Program (LIHEAP)
LIHEAP helps lower the cost of cooling and heating. It also helps low-income households by reducing the costs of certain energy-related home repairs and energy crises. Find and apply to the closest location here.
Crisis Intervention Program (CIP)
The Crisis Intervention Program is a federally funded program that helps people experiencing an energy-related crisis. This includes health-related emergencies and other potentially life-threatening circumstances. Through CIP, eligible individuals and families may receive financial aid until the crisis has passed.
To qualify, fill out and submit an application on CIP’s official website. Eligibility is determined on a case-by-case basis. Be prepared to show proof of income, U.S. citizenship, current utility bills, and an energy-related crisis.
Other state programs
Each state has its own programs to help low-income households pay their utilities. For example, North Carolina has EnergyShare, which offers energy and utility bill assistance. Run a quick Google search to see what your state has to offer.
Help with health care
Medicaid and CHIP
Children’s Health Insurance Program (CHIP) and Medicaid both offer healthcare at a free or reduced cost to eligible Americans. In certain states, people who fall below a certain income level may qualify automatically. Individuals with children or a disability have a higher chance of qualifying as well.
Families with children may qualify for CHIP, even if they make too much money to qualify for Medicaid. In certain states, pregnant women may also be eligible.
Both Medicaid and CHIP provide at least basic coverage, with each state offering different benefits. Check with your state for available services. Or, to apply for Medicaid, either contact your state’s agency or create an account through the Health Insurance Marketplace.
As part of the Affordable Care Act, each state offers subsidized health coverage. This includes CHIP, Medicaid, and various market insurance plans. These plans are designed to make healthcare more affordable for households that fall below the poverty line. Eligibility varies by state but is based primarily on income and individual need.
Every state has free and low-cost clinics. These clinics are available to low-income households and to people without health insurance. Most of these clinics offer treatment for chronic conditions, limited medical testing, reduced-cost prescription drugs, and other basic health care. Some clinics offer dental as well.
Free clinics receive funding from non-profits, state and local governments, religious organizations, and more. If you make more than a certain amount, you may have to pay a fee based on a sliding payment scale.
Retail walk-in clinics
Located in certain retail stores, these walk-in clinics offer basic assistance to those in need. This includes things like vaccines, x-ray exams, preventative care, and treatment for minor injuries and illnesses. Retail walk-in clinics are most commonly found in stores like Walgreens, Rite Aid, and CVS. Most retail clinics charge a small fee for their service.
Urgent care centers
Urgent Care Centers provide treatment to those with pressing medical conditions like an injury, an asthmatic attack, or the flu. They are not suited for those who need emergency medical care. They do, however, serve as an alternative to keep people who don’t need emergency aid out of the emergency department. When choosing an urgent care center, watch out for freestanding emergency rooms. They may look similar, but they come with a hefty fee.
Drug discount plans
Sites like GoodRx and Drugs.com offer prescription medication at a reduced rate with savings as high as 80%. These sites compare the current prices of medication and find the best discounts for patients. Most pharmacies in the U.S. accept these discounts, but you will need a doctor’s approval to qualify.
Generic discount drugs
Generic Discount Drug programs operate similarly to drug discount plans and offer prescription medication at a discounted price. They may charge a nominal enrollment fee.
Help for lost income
The U.S. Department of Labor offers unemployment insurance to eligible individuals. To qualify, you must be unemployed due to circumstances beyond your control. You must also provide proof of the duration of your employment and your income. Click here for your state’s specific eligibility requirements.
Unemployment benefits vary by state. For instance, in Florida, you may receive $275 a week for three months. In Washington, you may receive between $295 and $929 a week. To receive these benefits, reach out to your state’s unemployment insurance program and file a claim. The process usually takes a few weeks from the initial claim to the first benefits check.
Workers’ Compensation provides financial aid to those who’ve been injured on the job. It covers – or partially covers – things like medical treatment and vocational rehabilitation. To qualify, you must be a current employee at a company that carries Workers’ Compensation insurance. You must also have proof of receiving a work-related injury.
SSDI and SSI
Both the SSDI and SSI offer assistance to those with a disability. To qualify for SSDI, you must have a disability and have worked for companies that contribute to Social Security. For SSI, you must be blind, disabled, or 65+ years old. You must also have limited income and be a current resident of whichever state you’re applying in.
Tax credits help lower the cost of what you owe to the IRS. In some cases, they may even result in a refund. There are many tax credits available to those who meet certain requirements (ex. income limits). Available tax credits include the foreign tax credit, tax credits for families, and the child tax credit. For more information, check out this list of tax credits.
Disaster relief or Disaster Unemployment Assistance (DUA)
The federal government offers financial assistance to those who’ve lost their job due to a natural disaster or disaster-related injury. Check the details and your eligibility here.
Help with housing
Housing choice vouchers
Low-income households may qualify for housing choice vouchers. These vouchers help cover safe, reasonable housing from participating rental properties. For a list of all vouchers, click here.
Rural housing aid
This program lowers the cost of rent for low-income families living in an eligible Farm Labor Housing or Rural Rental Housing project. To qualify, the monthly cost of rent must be over 30% of the household’s adjusted monthly income. Contact them here.
Many local housing assistance programs also exist. These include the Housing Opportunity and Prevention of Evictions (HOPE) program, the Salvation Army, and more. To find out about programs in your area, dial 2-1-1 or contact a local housing authority.
Volunteers of America (VOA)
VOA is a non-profit organization that offers affordable housing to seniors, veterans, low-income families, and people with disabilities. It also provides assistance to those coming from jail or prison.
The purpose of VOA is to prevent homelessness and help people live independent lives in a safe place. VOA offers short-term and long-term rentals.
Individuals and households program (IHP)
Help with child care
The Office of Child Care strives to provide child care support to low-income families. This includes affordable afterschool programs and early education programs such as Head Start. These programs promote the learning and development of young children. Find your state’s programs and contact information here.
Help for women
For low-income women who need financial assistance, there are quite a few programs and grants out there. For instance, Single Mother Guide offers grants to single mothers. The National Women’s Law Center (NWLC) advocates for women’s rights and justice in society. Visit Single Mother Guide and the National Women’s Law Center for more information.
Here are a few more resources that may help.
- Benefits.gov — a (nearly) comprehensive guide to the benefits you may receive, including medical and food assistance
- Oblito.com — information on emergency services such as medical, housing, and food assistance
- 211 program — this program gives out free referrals and information to people who need human and health services
- Community action agencies — these provide child care, utility, and other grants for people in need
Other resources that might offer some relief
If you need immediate assistance, reach out to a local church, shelter, or food bank/drive. Other options include:
- Need Help Paying Bills
- Senior Resources for Professionals and Consumers
Payday loans aren’t your only option when you need emergency financial help. Watch this video to learn more:
COVID-19 pandemic and financial assistance
As of January 2021, around 12 million adults owed nearly $6,000 in back rent and utility bills. The U.S. government, Consumer Finance Protection Bureau (CFPB), and other agencies have been working together to help. These agencies, along with financial institutions, have introduced certain measures to help those most impacted by the pandemic.
Along with stimulus checks, the child tax credit, and other economic hardship programs, some lenders and creditors offer extensions to existing loans, lower interest rates, and flexible repayment plans.
Other programs have also popped up, including the Coronavirus Aid, Relief, and Economic Security (CARES) Act. This $2 trillion package includes:
- Economic injury disaster loans
- Reimbursed healthcare for preventative and treatment services
- Other economic aid
- State and local government relief to help programs continue to run
- Tax rebates and other tax relief
- Long-term unemployment benefits for gig workers and furloughed employees
- Stimulus checks
- Small business loans to help with overhead and keep staff employed
It’s not clear how long these additional programs will last, or who will receive the most benefits from them. That’s why, if you need help, you should ask for it sooner as opposed to later.
Many people who struggle financially feel like there’s no light at the end of the tunnel. This has been made even worse by the COVID-19 pandemic since it’s led to lost jobs, social isolation, and economic uncertainty.
While it may seem easier to wait for things to happen, or for finances to change, waiting doesn’t always work out. Changing your situation for the better starts with small but meaningful steps. Here are some ways to be a little more proactive about your situation.
- Refinance debt. Take advantage of low interest rates and refinance existing debt. This can increase cash flow and make it easier to pay monthly bills.
- Avoid new debt. Don’t take on new forms of debt like high-interest, short-term payday loans or installment loans. They may help with a current financial problem, but they could also lead to more debt later.
- Check your budget. Take a look at your budget in comparison to your total income. Look for ways to start opening up some of that cash flow each month (ex. cut back on dining out).
- Speak with your lenders about your situation. Lenders want to get paid, so they’re often willing to work with people who can’t afford to make payments due to circumstances outside of their control like a lost job. If your goal is to get your finances back on track, reach out to your lenders. Be polite and honest about your situation. Try not to wait too long or they may be less willing to negotiate.
Contact your loan servicers, lenders, and other creditors
Due to the pandemic, many lenders and creditors have changed their regulations to help consumers pay their bills. While not all of them offer the same things, some common options for debt and payment relief include:
- Waived late or overdraft fees
- More flexible repayment options
- Extensions on loan terms or payment due dates
- Waived fees on late payments to accounts in forbearance (if a direct result of the pandemic)
- Lower interest rates
Some lenders, creditors, and service providers offer these things to those who can’t pay their bills due to things like:
- Natural disasters that prevent them from getting to work or forcing them to vacate their home
- Emergency medical expenses
- Sudden unemployment
- Other emergency situation
In cases where the financial hardship is not your fault, some lenders may choose not to report late payments or certain account changes to the credit bureaus. Since even one late payment can damage your credit for up to seven years, this is especially helpful.
It can be stressful to speak with your lenders, or, for that matter, with anyone you may owe money. That’s why it’s best if you know what to say beforehand. Before calling, make sure you can explain the following:
- What you need — changes to due dates, extensions, etc.
- Approximately when things will return to normal and you’ll be able to make regular payments again
- Reason for the request (ex. unemployment or financial emergency)
- Your current debt, expenses, income, and assets
Since every lender, creditor, and service provider has its own policies, you may want to check their website or ask them about your options. Even if they say no to your initial request, they may offer something else that can help.
Protect the money you have
Whatever money you do have, keep it safe in a bank or credit union account.
The FDIC (Federal Deposit Insurance Corporation), an agency of the federal government insures most financial institutions in the U.S. This agency covers up to $250,000 in a single account per person against loss, theft, or an institutional shutdown. Because of this, FDIC-insured institutions are one of the safest places to keep your money. A few community banks are not FDIC-insured, though even they are typically insured by their state.
Many predatory lenders and scam artists target people who are experiencing financial hardship. Watch out for these.
If someone contacts you about a seemingly great deal, don’t take it. If they offer to help you if you buy something first, it’s probably a scam. And if you receive a random check in the mail, don’t trust it. Do your research to make sure any offer is legitimate and in your best interests.
Along with this, try not to panic. Even if you see your account balance drop, don’t make snap decisions about it. In times of financial difficulty, it’s all too easy to make a decision you’ll later regret.
For example, it may be tempting to take a so-called “investment opportunity” or gamble in hopes of recovering some of your money. However, investing is risky when you’re short on funds, and most people lose when they gamble.
Are there government debt relief programs?
There are not currently any government programs that forgive all debts. That said, there are non-profit consumer credit counseling organizations, which are funded by grants from credit card companies. These organizations use a qualified credit counselor to help people find debt relief.
National Debt Relief Hardship Program: What is it, what does it do?
The National Debt Relief Hardship Program is a prominent, highly-rated debt settlement company. Its purpose is to help people get out of debt and ultimately get their finances back on track. Those involved in the program typically see a total debt reduction of 30% after costs.
For many people, this program is extremely helpful. However, there are some downsides, including:
- Upon completion of the program, you will be charged 15% to 25% of the total enrolled debt.
- The program will damage your credit in the short term.
- The program takes up to four years to complete.
- You must have between $7,500 and $100,000 in unsecured debt to qualify. This includes credit cards, personal loans, and private student loans.
The way it works is simple.
Once enrolled in the program, you’ll be asked to open a separate savings account. Each month, you’ll deposit a set payment into the account. A certified debt specialist will negotiate with your creditors on your behalf to reach a debt settlement agreement.
If they reach an agreement, you’ll pay the creditor from the savings account you’ve opened. This continues until the debt is fully repaid. Usually, the payments you make end up being lower than what you would have owed otherwise.
When you have a handle on your debt, take control of your finances
It can take some time to get a handle on your debt. Once you do, the best thing you can do for yourself (and your family) is to keep that debt from growing again.
Here are some ways to do this:
- Track your spending. Use either a free budgeting app like Mint or monitor your bank statement to do this. Keep a record of every dollar spent.
- Make and stick to a personal budget. A personal budget is a great way to keep track of your income and monitor your spending habits. It’s also one of the first steps to take if you have a problem with overspending or want to start saving money. Here are some tips on how to make a budget.
- Create a financial plan to pay off any remaining debt. Just because you have a handle on your debt doesn’t mean it’s all gone. Make a list of any debts you still have and determine which ones take priority. Then, make a financial plan you can realistically follow as you start paying them off.
- Build or repair your credit. Good credit is a must if you want to qualify for future loan products – mortgage, personal, business, etc. – at good rates. If debt has put you in a bad spot, credit-wise, then it’s time to start building it back up.
- Assess your overall financial situation. It’s important to check in with your overall financial health every now and then. Figure out your debt-to-income ratio, net worth, total assets, income, and spending. Once you’ve done that, start jotting down some financial goals (ex. start a savings or education fund). This will help keep you motivated and in control of your finances.
The bottom line
If you’re struggling to pay bills or keep up with debt, you’re not alone. There are many local, state, and federal programs out there designed to help people just like you. There are also ways you can start to improve your financial situation right now. Even small steps in the right direction — for example, making a budget or reaching out to creditors — will help you get back in control of your finances and your life.