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How to get ahead of late fees

Q. Some of my creditors are charging me late fees on my accounts. I’m frustrated that most of what I pay gets eaten up by fees and that I fall further behind as a result. What can I do to get out of this cycle?

A. All creditors have their own policies and procedures that govern how they handle late fees and payments. Some creditors have special programs that can help you bring your payment current. These programs come with specific guidelines, so not everyone will qualify for them.

At the very least, you will need to explain why you have been late on your payments. You may also have to fill out a new financial statement and provide your creditors with additional information before you qualify for assistance. You won’t know what’s available to you, however, unless you take the time to contact your creditors.

If it turns out that your creditors don’t have a relief program, you need to develop a plan to bring your accounts current on your own. Start by pulling out all of your statements and recording how much you are past due on each of your accounts. Make a list of each account, the amount you are past due and the date that you will need to pay the balance owing. Sometimes, seeing everything laid out in front of you can make a task seem less daunting.

As you consider how to resolve your past due debts, resist the urge to reallocate money you usually use to make other payments; to do so is to trade one set of problems for another. Instead, you need to find a way to increase your income or reduce your expenses.

This might involve using part of your tax refund, getting a part-time job, working some overtime hours or selling something that you no longer need or use. Cutting out unnecessary spending on incidentals, consolidating your errands and sticking to a menu can help free up cash, too. While you’re working on getting your accounts current, refuse to be complacent about your spending—even small amounts of cash add up.

While it’s frustrating to see most or all of your payment going to fees, you must resolve to bring your accounts current by all means possible. If you don’t, you will fall further behind and your fees will continue to mount, making it even more difficult for you to dig yourself out of debt.

Bonnie Spain is the executive director of Consumer Credit Counseling Service of the Black Hills, a United Way member agency. For more information, email

The material in this transmission is provided for personal, non-commercial, educational, and informational purposes only. ACCE makes no representations or warranties with respect to the accuracy or completeness of the contents of this transmission and assumes no responsibility for errors, inaccuracies, omissions, or any inconsistency herein. You should consult a professional where appropriate.

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