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Debt "Melt-Down" Tip # 1

 Monday, March 10, 2008

I put this series of tips together in order to give you the
information that the banks and big credit card companies DON'T
want you to know. If you set aside just one hour a week, and focus on implementing these tips, you can look forward to a
life free of money worries, a life where you don't have to work
until you're 72 years old, a life where getting a social
security check is a bonus, NOT a neccessity! The life you Deserve!

Today we are going to focus on your "frame of refference." What I mean is, we have to find out EXACTLY where you are today
so we can come up with an accurate plan for your future. You'll
notice I put the word EXACTLY in bold and all capital
letters. I can't stress enough about how important it is to figure
out what you consistanly spend on a monthly basis.

I'm talking about EVERYTHING! Your groceries, your utilities, your gasoline, your life insurance, your cable and internet,
your hobbies, your debt payments including credit card(s),
installment loans, mortgages, car loans/leases, personal loans,
your child care, any charitable contributions. I mean EVERYTHING!

Now, I know what your thinking. Your thinking "This is going to be a BIG pain in my a$$!" With that being said, I want you
to think about the "pain in your a$$" you'll have when you can't
retire, because you can't pay ALL your bills on your
retirement wages! I want you to think about being forced to retire and having to take a job at WallMart as a greeter because
you can't pay ALL your bills with your retirement wages! A "pain
in the a$$" here in the present will avoid a more harmfull
"pain in the a$$" in the future, BELIEVE THAT!

Here are some of the easiest ways to get this information together;

1 - Gather all your monthly debt statements together including
credit card statements, personal loan statements, installment
loan statements, mortgage statements, 2nd mortgage statements or
Home Equity Lines of Credit, auto loan statements,
motorcycle loan statements, recreational loan statements, etc...
Once you have the statements in front of you, write down
the name of the debt, the payment you make each month, and the
balance owed on the same line. Then repeat with every statement
one on top of the other until you are done. Add up all the
balances owed and all of the monthly payments and write it at the
bottom of the page.

2 - gahter your checking account statements or check book and look
at what your paying for your living expenses including but
not limited to the following: Groceries, Gasoline, Insurance(Auto,
Home, Life), Utilities(Water, Electric, Gas, Association
Fees), Phone(cell and home), Cable(TV and Internet),
Recreational(Hobbies, Sports, Clubs, Leagues, Season Tickets,
etc..), Charities, Investments outside your 401K or company
retirement, Fun(Movies, Eating Out, Going Out), Clothing, etc...

Now, I know some of these items like clothing, utilities, Fun, and
Recreational can be seasonal. You may have to figure out
a manthly average for these but make sure to over estimate and not
under estimate. Once you have these figures, simply add
them up just like you did with your debt payments.

3 - Once you've completed steps 1 & 2 add the total monthly
payments together so you have the monthly spending total. Now,
I want you to figure out your net income or your take home pay
after taxes. You can do this by looking at your pay stubbs
or your bank statements. If you are paid weekly multiply your Net
income by 52(weeks in a year) and divide by 12(months in
a year) and that will give you your monthly income. If you are
paid bi-weekly multiply your Net income by 26(bi-weeks in a
year) and divide by 12(months in a year) and that will give you
your monthly income. If you work overtime, you'll want to
figure out your average overtime per week but be conservative.

4 - This is where things could get Scary! You need to compare your
total monthly payments to your net income. If your net
income is $300+ higher than your monthly payments, that's a good
sign unless you don't notice the extra money because that
means you left something out ehn you were figuring out your monthly
expenses. If your monthly payments are higher than your
net income, that means that you're financing your lifestyle. You
will be a slave to your bills until you decide to make a
change. Things will no doubt, get progressively worse if you don't wake up and change your spending habits. If you're net
income is under $300 higher than your monthly payments, you are one unexpected expense away from financing your lifestyle.
You are in the grey area, living a little bit better than paycheck
to paycheck.

Regardless of where you are, you're not where you should be! It's not that you don't make enough money, it's that you spend
that money in the wrong way. The sad truth is, it's NOT YOUR
FAULT! In your next Success tip, we're going to cover
The Real Reason You're in Debt and Can't seem to find a way out!

Until next time, your friend, 

Brandon Hays 
Certified Debt Melt Down Consultant
(816) 795-7878 Office
(816) 795-7860 Fax
www.ShowMeDebtRelief.com

P.S - If you've read my FREE Report, then you know
that I will give you a FREE Debt Melt-Down Analysis which
is the first step to handling the challenges mentioned in this
email. If you have any questions, please don't hesitate to
call my office at 816-795-7878. I can't reiterate enough about the
fact that time is your enemy when it comes to dealing
with financial issues such as debt!

P.P.S - If you have found this information useful, no one has
told me they haven't, why don't you foward it to a close
friend or associate? I am sure they will thank you a ton for the
info. After all, what are friends for!