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Using Credit Wisely: Identifying Issues & Setting Limits
Prepared by:
Sissy R Osteen, Ph.D., CFP®
If you Answered “Yes” to:
1-2 questions: You may be developing financial problems.
3-5 questions: You are on the edge of Financial disaster.
5-10 questions: You are in over your head.
Your Financial Situation
Income
Expenses
Debt
Determining Income
Income Source Weekly Bi-Weekly Month Yearly Total
Salary
Tips
Soc. Sec.
Retirement
Child Support
TANF
Student Loans
Tax Refunds
Other
Determining Expenses
Housing Food Clothing Transportation Childcare Medical School Expenses Entertainment Personal Items Reserve Savings* Miscellaneous
Occasional Expenses
Past 12 Months
Home Repairs $
School Expenses
Car Maintenance
Car Insurance
Medical Expenses
Clothing
Gifts
Vacations
Property Taxes
Total $
Reserve Account
Having some meansFinancial Freedom
Having none means Catching Up and More Debt
Defining Your Debt
Lender Monthly Payment
Balance
Car Loan
Credit Cards
Bills
Loans
Is there a Debt Problem?
Income minus Expenses
= Amount Available for Paying Debts.
- =
Sometimes looks like this
- =
- =
Or this
Debt/Income Ratio
Monthly DebtMonthly Income
Debt/Income Ratio
15% or Less Usually Not a Problem
15-20% Plan Carefully
20-35% Cut Back!
Over 35% Seek Help!
What To Do If You Need Help
Stop using your credit cards.If you have money, contact your creditors and ask for lowered payments.
If you have been threatened with legal action, contact a lawyer.
Questions