According to the 2011 Financial Literacy Survey from the NFCC, one in four adults admit to not paying all of their bills on time. "If you're paying late fees regularly but not defaulting, you are able to pay but are choosing not to pay on time and incur the late fee. The larger problem is fiscal irresponsibility," says Ulzheimer.
"If you're living paycheck to paycheck and paying late fees, you're a ticking time bomb. If an emergency happens or you get laid off, you will be tempted by pawn shops, car title and payday loans that are an extremely expensive start on your way to total default on all of your obligations."
If you find yourself juggling too many payments or too much debt, consider credit counseling or getting into a nonprofit debt management program.
"Go through the government-regulated National Foundation for Credit Counseling and stick to the program of paying back your debts and your monthly expenses on time with lower interest rates and no late fees," says Ulzheimer. "It takes hard work, commitment and typically three to five years to complete, but you'll get out with excellent credit and no debt."