5 Financial Mistakes To Avoid When You're Broke + Share your survival tip & you could win

Special to The Birmingham News

Today on al.com there's a story about a mom who is

According to the charges two banks were robbed during the summer months in Vestavia Hills.

I do not know the circumstances that led to banks being robbed but

.

Acting upon them is a different story.

Hopefully you'll catch yourself before you do anything really crazy.

Always keep this in mind, things can get really bad financially but try not to create bigger problems you can't get yourself out of or create new issues down the road.

Here are 5 things you should avoid when you're broke --

1.  Don't use check cashing services --

If you write a check to get an advance on this week's paycheck to pay a bill you will set yourself up for disaster.

You cash out the check to pay your bill.

You feel good that it's paid.

Then you realize you have to pay it back immediately to avoid a huge interest fee.

Then you have another problem come up the same week that you need to pay the check cashing facility.  The new problem eats into your paycheck making it hard for you to pay back the original debt you owed the check cashing facility.

So you decide to pay a portion of the check cashing fee just to get by until "you can pay off the whole amount."

It continues on that way until finally it's way more than you borrowed in the first place.

Make payment arrangements with the original bill instead of creating a new bill with the check cashing place.  If they won't make arrangements with you, ask what the late penalty is.  It could be a lot cheaper to pay it late than to pay mounting interest fees at the check cashing place.

Sources for quick cash

--

Look through your junk and collect as much as you possible can to sell at pawn stores, metal recycling facilities, book buy back stores, Craigs list.  Even if it's $20, that's $20 more than you had before and you got it without creating more debt.

You could also have a quick yard sale on a weekday early in the morning or late in the afternoon -- Put up a one day only sale and catch folks on the to and from work or school.  You might be surprised what you sell.

2.  Don't use title pawn services --

You can loose your car or end up paying more than the car is worth in interest.

This is playing with fire.

Things happen that make that loan payment get way out of control.

Don't be tempted to do this.  It's easy.  It's quick.  It's will make you feel like you have things contained for the time being.

That's until you realize yet again -- I just added another bill to my weekly or monthly budget.

3.  Don't give up -- Make an effort to call, cancel or put services on hold. 

Call all of your utilities and ask for assistance.  Some will make you go to extremes to get it others won't, but whatever it is you need to do to keep the lights on and the debt down do it.

If you have contracts with cable, TV, cell phones etc.  Ask for temporary holds on your accounts until you get back on your feet.

You will still owe the full service amount it's just a delay in paying it without interest.

4.  Don't overspend at the grocery store --

You have to change your mind about the items you buy and the way you pay for groceries.  It's important to cut and cut some more when it comes to what you're buying.

I'm talking to couponers too.  Just because a deal is awesome and possibly even free, if you have to drive out of your way to get it, you can really hurt yourself.  The deal will come back around, the money will not.  Even if it's just a few dollars you'll resent the deal if it means you can't meet an obligation that hurts your family.

5.  Don't misappropriate funds --

This is a double edge sword here.  You need to prioritize what bills get paid and what bills do not when you are severely broke.

House, car, water, groceries, power and gasoline are my priorities.

When you're down to the bare bones budget there are things that can be paid last.  You will need to be honest with yourself about needs and wants.

But with cutting or not paying bills in order to pay others you'll more than likely incur interest or late payment fees.  You will need to weigh the options to see which is more beneficial.

I'm not telling you what should be a priority, I am telling you to be honest and don't worry about what other people think when it comes to cutting out the amenities in your life.

Although

things don't work out like that in real life.

My advice is to communicate with your spouse and work together to come up with the best way to get bills paid and food on the table.

Being broke can be the best thing that ever happens to you as a couple if you use it as way to grow...

ALTERNATIVE INCOME RESOURCES --

Got a limited income?

Sometimes working a second or third isn't possible.  If you have already exhausted employment opportunities, try to jettison products online.  List items in the classifieds, on your Facebook page to your friends, sell on eBay, look for swapping forums or swap meets you can attend.

Don't be ashamed to ask your co-workers, neighbors and friends to save cans for you.  Pick them up and recycle them once a month.

Part with your books -- 2nd & Charles buys back gently used books you can also sell them on Amazon, eBay and Craigs List.

Get creative, not desperate.

GO H

LIVING.

FEEDBACK & GIVEAWAY ---

Please share your serious tips for surviving or avoiding financial pitfalls, or your story of making it through a rough time.

The best tip (judged by the how many replies they get to the comment will win a $10 Starbucks gift card to treat yourself to a little bit of luxury)

How it will work --

. (look for the post with the wallet) If your comment gets the most likes or responses saying it was the most helpful or most inspiring you will win the gift card.

The most likes or @responses by 11 a.m. tomorrow will be the winner.

If you leave a comment here on the blog you'll also be entered to win a gift for your child that will include some fun items to brighten up your child's day valued at $20.  I know it's hard to bring home things for your kids when you're broke.

I will select that winner via random.org.

You can enter both, however you can't win both.

I'll announce the winners tomorrow at 11 a.m.

Now share your secrets to surviving a dry spell financially....