Low five: Indicators that may show you are in financial trouble

For consumers who may wonder if they are creating more debt problems for themselves, there are some warning signs they can pay attention to.

According to a report from the ABC affiliate in Baltimore, there are five ways consumers can know if they may end up having a difficult time managing money.

One thing consumers should pay attention to is their credit score. If a person’s credit score is below 600, they may end up finding it difficult to get a loan.

"In general, any credit score below 600 means that you are probably in over your head," the report stated.

Saving money is also an issue consumers should consider when determining their financial situation. According to the U.S. Bureau of Economic Analysis, the amount of money saved in May increased to 6.9 percent. The report from the ABC affiliate states that if a consumer is saving less than 5 percent of their income, they run the risk of finding trouble if an emergency arises.

Rising Credit card debt is another sign that a consumer might be in trouble. If consumers only make the minimum payment on their credit cards, they run the risk of being further in debt.

Consolidated Credit warns consumers: Minimum payments are a trap.

Consumers will never payoff credit card debt by paying just the minimum payment. Currently the average interest rate is nearly 15 percent so consumers should pay the minimum payment due plus the amount of the interest. Ideally they ought to be paying credit cards in full each month, but in this economic climate that can be extremely difficult.

The report states the amount of a consumer’s income that goes toward their mortgage is another warning sign. Having 28 percent or more of their income go toward their house is a sign that a consumer be in financial trouble.

Finally, budgeting should also be a concern for consumers. The report suggests considering all the bills a person has and eliminating those that aren’t essential. That would include going out to eat less and being smarter with how energy is used in the home.