What to Do If You Can’t Pay Your Bills

final notice

Have you ever missed a bill payment or two?  Believe me, you’re not the only one. I recently opened a letter with the big scary title above, check out my story and I’ll share four things you should know if can’t pay your bills.

Our Unpaid Bill

The story actually starts at the end of last summer, when we moved to a different neighborhood.  You’ve probably heard me talk before about how I’ve automated all our bills but the gas bill slipped through the crack we moved to a new address.

Apparently we didn’t pay our heating bills (the largest of the year) so our next statement contained a stern reminder to pay the almost $400 we owed the gas company.

The problem with all of those statements is that I was putting them into a “to-review” folder and assuming they were all being paid automatically.

Which of course meant I didn’t read the disconnect notice that came towards the end of last month, or the Final Disconnect notice that came a week later.

My Heart Dropped

I was in the waiting room at the dentist office going through some mail when I finally opened the notice and my heart dropped.

Oddly enough, as I sat there trying to figure out what had happened my cell phone rang – it was my wife freaking out on the other end.  The gas company had just called and was shutting us off if we didn’t pay by the end of the day.

I know everyone in the waiting area could hear my wife’s distressed plea to pay the bill and I imagine the receptionist peeked at my insurance coverage again to make sure I wasn’t going to stiff them for a few hundred bucks too.

You’re Not Alone

I know we’re not alone, many other couples have gone through the same thing.  And the stress would probably be overwhelming if you didn’t actually have the money to cover the bill like we did.

If you ever find yourself in this situation, don’t panic.  I’m sure you will at first (I did) but once you’ve had a few minutes to get past the cursing and hair pulling, here are some things to consider.

1) They Don’t Want to Lose You

One of the biggest costs that businesses face is finding new customers.  The longer you’ve been a paying customer, the more valuable you are to them.  If they lose you, they have to go spend more money to find someone to fill your spot in their monthly cash flow. 

What they really want is for you to remain a paying customer.  So even though you may feel guilty because you owe them money and haven’t paid, remember that they likely still see you as an opportunity and are probably willing to work with you.

2) Call Them Quickly

As I mentioned, many companies are willing to work with you so call them up immediately, explain your situation, and see what they’ll do to work with you.

3) Partial Payments Beats No Payment

If you don’t call them and don’t pay, they’ll stop your service and come after you for the money.  But even if you can pay just a portion of your bill it might get you by for a while.

When I called in to pay my gas bill the lady on the other end asked “how much do you want to pay right now?” I didn’t realize that partial payment was even an option but she said that people do it all the time to avoid being disconnected.

I went ahead and paid the full balance, she was pretty surprised, I guess most people don’t do that.  So if you don’t have the money, offer a partial payment.

4) Cancellations are Expensive
Our final notice showed that it would cost us even more money if we didn’t pay our balance and they shut us off. To get service again we’d owe:

  • $65 reconnect fee
  • $24 collection charge
  • $250 security deposit

All those fees would almost be as much as the amount we owed, so if we hadn’t had the money it would have been much cheaper to make a partial payment and avoid a disconnect.

My scenario is with the gas company but if you have any business you’ve signed a contract with chances are they’ll charge you an early termination fee if they shut off your service.

So the bottom line is if you stay in close communication with your debtor and pay them enough not to shut you off it can save big bucks and buy a little time.

Have you ever had a bill you couldn’t pay? How did you handle it?

2 Responses to What to Do If You Can’t Pay Your Bills

  • Nerdizen

    In the early years this was a rather frequent occurrence and we were given a “stay of disconnection,” by simply explaining that we had an infant child at home (which was true by the way) and got on a payment plan that was spaced out enough for us to come up with the money. They even gave us a two week extension before we had to pay anything. This method works with the utilities if you live where it is too cold
    or too hot and you have a small child at home.

    • Ben

      Thanks for pointing that out, you’re right if it’s something like the power company or gas company they’re more likely to work with you, particularly in climates where it gets pretty hot or cold. Many utility companies do have a level pay plan where they spread your average annual costs out over 12 months so you don’t get hit with a $400 bill in the winter.

      Something else I learned last night, if you live in California and are having a tough time making your house payments, the laws in that state makes it a little easier for you to negotiate extra time to pay your bills.


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