Have a Plan to Get Out of Consumer Debt Within 3 Years

Take Action Today

The secret to solve your debt and credit problems is to setup a good plan: simple and effective.  It takes a bit of discipline and common sense. But there’s no point in delayed it; take control and start getting out of debt today.

Your plan should have an immediate impact and help you get out of consumer debt within 3 years.  After that, only your mortgage and maybe a car loan will remain and can be the exception.  It could take more time only if your credit situation is extremely severe.

Use Online Debt Repayment Calculators

To estimate what you should expect to repay each month, use online calculators.

Develop An Annual Evaluation Program For Members Of Your Organization

Annual Meetings to Improve

At least once a year, business leaders should meet with each member of their service or organization to evaluate them in a well structured matter.

If possible, choose the same slower-business period every year for these talks and produce a written report.

All must take place with trust in mind and in order to improve the general operations and business process of the organization.

A Structure to Show That You Care

Each employee’s annual meeting report should include:

a) last year retrospective, 
b) personal goals and 
c) organizational goals for the coming year.

Avoid Extras And Gimmicks When Shopping

Just Say No!

This may seem a bit simplistic but when you shop: avoid gimmicks!

For example, don't buy the doubled-price-shining-bottle thing we strongly suggest for your new shoes. I am not saying not to care for your shoes, but there’s probably a way to do it without the little-20 bucks bottle.

In fact, don’t be surprised at the cash register by the offer, do not get caught and do not be afraid to simply say: "No, thank you!" However, don’t be mad at the person begin the counter; she’s only doing what the boss is asking.

Extras Can Really Add Up

A classic is the cell phone or electronic device scam. For these you must buy a nice leather case, an adapter, a charger, batteries, a memory card and, do not forget, spare batteries. And yes, the inevitable monthly service-plan. After all these gadgets, you get a pretty expensive bill. It’s not forbidden to recycle a case or batteries whenever possible.

Apply Medical Expenses For The Whole Family On The Same Tax Return

Because your medical expenses deductions are reduced according to your income (3% of your income), rather than using them separately, it is permitted and advantageous to claim medical expenses on the same federal tax return for the entire family.

You may simply not reach your income reduction limit if you use these deductions on separate returns.

You can deduct medical expenses made for yourself, your spouse or your children if they were paid by you or your spouse.

Example

Let’s suppose both Mom and Dad have a $50 000 taxable income and that, medical expenses are $1000 for Mom, $800 for Dad and $400 for Baby.

Claimed separately, Mom (with Baby’s expenses included) would get no deduction
($1000+$400-$50000x3% = $1400-$1500 = -$100 < $0).
No deduction for Dad either
($800-$50000x3% = $800-$1500 = -$700 < $0)

But if Mom claimed all the family’s medical expenses on her return, she would deduct 700$.
($1000+$400+$800-$50000x3% = $2200-$1500 = $700)

The First Step To Get Out Of Debt : List Your Liabilities

Make a List

The first step to improve a bad debt situation is pretty simple : make a list. 

Your death list...oops...your debt list!
And soon, your back-to-life list!

So, just write down your family’s debt report.  This report simply is a detailed list of your liabilities.  It should help you easily assess your credit situation.  This is the fist step for you to take back control.

This list should contain all your liabilities: credit cards, car loan, credit line balance, student loan, etc.

Do Not Forget

Your mortgage, probably the most important liability for most, should be included in your list.

A Different Way To View The Budget

Most people do not like having a budget. They see it negatively. A budget has a complex and restrictive aspect. Keeping a budget necessarily means making sacrifices for them. For them, budget is so often synonymous with cuts?

A Great Tool to Make Choices

In fact, we should rather consider the budget as an extraordinary tool; a simple tool that allows us to assess the situation, to regain control, to make corrections or changes.

A good budget also allows us to make choices, informed choices.

Realize Your Projects, Your Dreams

The purpose of this is to reward ourselves; to choose knowledgeably to indulge ourselves. It is ultimately the only way to acquire the means to realize our dreams.

Quickly Estimate Your Life Insurance Need

Use the following formula to quickly estimate the level of life insurance coverage that you need:

Life Insurance Need =

Dependents x10 + Final Expenses + Debts – Assets

Dependents:

The annual amount necessary to meet the needs of people who financially depend on you. These people are mainly your children, maybe your spouse or other members of your family.  Your children will usually reach financial independence around the age of 25.

Factor 10:

This factor is an approximation.  The number 10 is relatively suitable for most cases, especially if dependents are young children.  It should be increased if a longer dependency period can be anticipated, for example, for handicapped dependents or stay-at-home spouses.

Final Expenses:

Mainly funeral expenses and other expenses to cover at death. The only part of the equation for all, throughout life. 10,000 to 15,000$ should be sufficient.