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Pioneer Blog

Getting Out of Debt with a Low Income

Posted on February 26, 2020

There are mountains of articles about getting out of debt that mention things like putting extra spending money towards it, doing the “snowball method,” or saving money to put towards debt by not buying coffee but instead making their own. All of these are great tips, but only for certain people.

For many people who struggle to pay their bills day to day, that have to make choices between buying food or paying for gas, these tips are not useful at all. They don’t have money to spend on Starbucks or have extra money to “snowball” their debts. If this sounds like you, don’t worry, we see you and have some advice on still getting out of debt.

Get Professional Financial Advice, Now!


three woman dressed professionally and talkingEverybody’s situation is different, whether it’s the amount of debt, your income, or where you live. There is no “one size fits all” financial advice, everybody has to come up with their own plan that will work for them. Some advice works for others, while actually harmful to someone else.

If you feel like you are struggling, you should really consider getting in touch with a financial adviser. They can help analyze your debts, income, and situation and then create a plan just for you on how to get out of debt and improve your financial standing.

There are a lot of professional financial advisers out there, many of which cost money. Pioneer partners with GreenPath Financial Wellness so our members can get financial counseling, for free! They can help assist you with consolidating debt, creating a budget, and identify methods to get you out of debt. If you are a Pioneer member looking to get out of debt, contact GreenPath today to get started.

Learn More About GreenPath!

Consolidate Your Debts, Especially High Interest Ones


When it comes to paying off debts, it’s a race against time. This is especially true if you have outstanding debts with a credit card or a loan with a high interest rate. The longer the debt exists, the more money it will drain away from you.

A good first step is to try and consolidate all of your debts, especially high interest ones, into a single loan. This can help focus your attention on it, and even get you a little extra spending money to work with. Rather than having to make several minimum payments, you only need to do one if you can consolidate all your debt. Then you can take the extra money that would go towards minimum payments and just put it towards paying off your debt. By consolidating your debts, you’ll also decrease the total interest you’ll have to pay, saving you money in the long run.

One way you can consolidate your loans is with Pioneer by using our Signature Loan. We can work with you to bring your debts into a single loan with a lower interest rate and a single minimum payment.

Contact Creditors to See What They Can Do


woman talking on a phone and wearing a gray suitIf you are struggling to pay off your debts, it’s easy to see your creditors as the enemy. In reality, they are just a business trying to get their money back. They don’t want you to have late payments, have your debts go to collections, or tank your credit score. They understand that by closing out your account, sending the debt to collections, or giving up on it, they lose money, which is what they don’t want to happen.

If you are struggling, or believe you are right on the edge of struggling with debt, get in touch with your creditors to see what they can do. Many have programs in place to help people struggling do some catching up without ruining themselves financially. A few ways they might help include: lowering your interest rate, adjusting your minimum payments, or even decreasing how much money you owe. Their goal is to make back their money, or as much as they can, rather than risk getting nothing back. It’s a wise choice to get in touch, just to see what they can do to help.

A prime example of this at Pioneer is our Skip-a-Pay option for members with loans. As long as the member is in good standing, they can skip a month of paying on a loan and pick it back up next month. That way, you can get a month to either pay off another debt, save some money, or take care of a bill that’s randomly popped up.

Don’t Go to a Payday Lender


woman sitting with a group of people talkingIf you struggle with debt and a new expense pops up, you might feel like you are stuck, with no way to pay for it. It becomes the question of, do you pay for food for the month or fix your car? Or maybe it’s keeping the lights on in your home or paying to take your kid to the doctor? At times like this, there might feel like only one solution; to go to a payday lender.

When you go to a payday lender, all you are doing is digging yourself further into debt and putting off your problems for a later day. It’s a simple recipe for disaster, as you’ll likely need to take out another payday loan to pay for the bills your paycheck  was supposed to cover.

At Pioneer, we will do all we can to help people in our communities and especially our members avoid the pit of debt that comes with going to a payday loan. Come visit us before contacting a payday lender to see what we can do to help first. Things like connecting you with a GreenPath financial adviser, helping consolidate some of your debts, or doing a Signature Loan with you to cover some expenses, we want to help. We want to help, so stop by a branch if you find yourself struggling so we work with you on improving your situation.

Visit a Branch For Help!

Member Benefits
GreenPath Financial Wellness Signature Loan
Credit Builder Loan Skip-a-Pay

 

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