Top signs your finances are headed down a dangerous path

Most consumers who have financial difficulties don't start out that way. In some cases, they may slowly begin to accrue credit card debt that spirals out of control. In others, they may take on too large a mortgage or get hit with an unexpected bill that forces them to turn to credit. Regardless of whether debt creeps up slowly or is the result of circumstances beyond a consumer's control, it's important to recognize the common signs that point to a dangerous financial road ahead. Knowing the common debt indicators early on can give individuals the time they need to change their spending patterns or enlist the help of a credit counselor.

One of the first signs that a consumer may be losing the grip on their debt is only being able to make the minimum payment on balances, according to CBS News. Paying at least the minimum is crucial for consumers' credit standing, but it does little to effectively tackle their debt if they have high interest rates and large balances. If after all the bills have been paid and necessary purchases, such as groceries and gas, are accounted for and consumers have little left to save or pay off a balance, it may time to examine their budgets. In some cases, it may just be a matter of reorganizing their spending. In others, adults may find they need to cut back on little luxuries, and discipline their spending.

Being forced to use credit cards to make payments on other lines of credit or bills is another worrisome sign. If individuals find that there is no way to meet their financial obligations without relying on their credit cards, it may be time to consult a financial advisor or enroll in credit counseling. Being forced to rely on credit can indicate that adults' income is stretched too thin, which may require some lifestyle changes and downsizing to break their dependence on credit.

Lastly, individuals who frequently max out credit cards or bounce checks may also be overextending their finances. Further, maxing out lines of credit may also come with fees and penalty rates, and result in credit score damage.

Consumers have several options when it comes to paying off debt, ranging from implementing new money management plans to entering a debt consolidation agreement. However, it's important that adults seek financial counseling to learn which choice may work best for their particular situations.