There are very few times as a financial counselor that I’m going to tell you to NOT pay your bills. In fact, the Bible is very clear that only the wicked borrow and do not repay (Psalm 37:21). The verse you’ll hear me yell from the mountaintop is Romans 13:8, which begins, “let no debt remain outstanding…”. But there are times when paying a bill makes no sense. Let’s spend some time on that thought today.
- Don’t pay it if it isn’t yours. This may sound obvious, but the common mentality among the “average American” is to get a bill and eventually pay that bill. I’ve counseled dozens of people who pay bills that are inaccurate, incomplete, and often not even their bill! Make sure you know the bill is something you are supposed to pay before you pay it. Otherwise you might never get your money back and you might just be supporting fraud.
- Don’t pay it if it isn’t a valid debt. This is not quite the same as #1, but it is pretty darn close. The Federal Fair Debt Collection Practices Act (FDCPA) says it is the responsibility of the creditor to prove a debt is valid before you can be forced to pay it. If you have a debt that you’ve paid off but the company says you haven’t or if you have a debt that appeared out of thin air, know that Federal Law is on your side. Don’t pay that debt until the company can prove it is valid. If they can’t prove it, you don’t have to pay it.
- Don’t pay it if your budget says you can’t. The math of a budget isn’t going to change just because you have more bills than income. That isn’t magically going to increase your salary or cause other creditors to call up and say, “never mind, John. I know you’ve got a lot on you right now so don’t bother paying us for the next few months.” Ain’t gonna happen. Make a plan to pay your debts, but there may be times when your budget says you can’t afford to pay them all. Prioritize and pay things in an order that makes sense. Get to the others when you can.
- Don’t pay if you are in a crisis. When my brother-in-law fell off his church roof early this year and broke nearly every bone in his body, innumerable trees were killed simply to print all the bills they were sent from every hospital, doctor and random medical professional in the universe. Without his income and without health insurance, they were in bad financial shape. My advice to my sister during this time was to pile all the bills in a big shoebox and forget about them for now. She had a husband and two kids to care for, a job to keep, and a brother to pick on. That was plenty. Now that he’s out of the hospital and on the road to recovery, she is dealing with them at her pace. And you know what; the world didn’t come to an end. So if you’re in a crisis, don’t be desperate about paying bills, be focused on surviving the crisis. The bills can wait a while.
- Don’t pay if it is going to be messy. Yes, 2012 has been an exciting (and mostly not in a good way) year for us. With my dad’s death resulting from a car accident, he was in the hospital for about 18 hours undergoing every treatment, surgery, etc. known to man. With two auto insurance companies involved, multiple health insurances, life insurances, etc. you can only imagine how messy this whole process is going to be. The first bill we received was for dad’s helicopter flight from the crash scene to the hospital – $18,000. My brother opened it and showed it to me. With tears in his eyes he asked, “what should I do with this?” My response: “Brian, get a box and put every bill related to this junk you get in there for now. We’ll deal with it eventually, but not right now. Insurance companies have to fight it out a while first.” We’ll eventually face all those bills as a family, but I suspect most of them will go away with insurance payments and other stuff that will happen over the next few months.
As I close, let me give you a disclaimer. I will not condone you using this information as license to misbehave with money then be a punk about repaying your debts. I will hunt you down and smack you if someone tells me you didn’t pay your debts because “Barry said I didn’t have to”. God is pretty clear that you are to repay your debt. I am hopefully being equally clear that you must repay your debt. But only repay those debts that are yours, that won’t keep you from putting food on the table to pay and those you are mentally able to face today.