In these economic times, people in all walks of life have to face the consequences of accumulating debt. It is always easy to get into debt, but never easy to get out. When seeking professional advice on how to cope with existing debt, it is best to be prepared with the following information:
Current Income: What is the household total income from all sources? This is necessary to determine how much money is available to pay for the necessities of life and how much is left to repay debt.
Current Household Expenses: Much to their detriment, most people do not budget for the household expenses. This is the first problem that gets people in debt. It is quite frankly a refusal to face reality. If we do not have a budget, then we will resort to credit to pay for what we “need.” A monthly budget should include not only the monthly reoccurring expenses, such as mortgage/rent, car payment, utilities, but also expenses that occur less frequently but can be anticipated, such as car oil change, medical/dental expenses, etc.
Assets and Liability Statement: Everyone should be aware of the current value of their assets and the amount of all outstanding liabilities (mortgages, credit card debt, student loans, etc). It some instances, it may be necessary to liquate some assets to repay debt. However, some assets are protected from creditors’ reach most of the time, such as retirement account, so liquidating those types of assets is seldom a good idea.
Once you are armed with all this information, then the next step is to design a plan to get out of debt. If you need help with that, we are offering a special free educational seminar on August 17th to address these issues.
To RSVP for our Educational Seminar on August 17, please contact The Law Offices of Susana B. Tolchard & Associates at 661-287-9986.