| Cash advances are very enticing when someone is in | | | | want you to write down all of your expenses. Rent |
| a cash crunch. We have all been there, having more | | | | mortgage, vehicle note, vehicle insurance, phone bill, |
| month than money. What do you do? | | | | internet bill, electricity bill, cable/satellite bill, grocery bill, |
| For many individuals, there is limited options. So, starts | | | | day care, gas for vehicle, tithes. These are the big |
| the chaos. | | | | ones, there are probably some that I missed. Just |
| Cash advances rates are outrageous, usually ranging | | | | make a journal of all of your expenses. This should |
| from $15 to $30 to borrow only $100. Do the math, and | | | | show you where your money is going, |
| for a two-week loan, these finance charges result in | | | | The next step is to figure out your income. Our focus |
| rates from 390 to 780% APR! Ouch! Shorter term | | | | is cash flow, only use your net income, again, the focus |
| loans have even higher APRs. Really?! If your credit | | | | is cash flow. Once you have these figures, our goal for |
| card tried to charge you that kind of interest, you | | | | this model is to take 70% of your income (multiply your |
| would tell them no thank you!Now that I have your | | | | income by .70) This is our target figure that we will use |
| attention, lets focus on solutions. | | | | to pay your expenses. You may be wondering what |
| What got you here in this situation? | | | | happens with the other 30%. Well, 20% of your |
| The 1st step is recognizing that you are in this situation, | | | | income will be used to pay off old debt. Divide it up |
| you have to admit it. The 2nd step is to write down | | | | however you need to, that is the amount of your |
| your budget. This may seem hard to do. If that is the | | | | budget that you will used for your old debt. The |
| case, then I suggest that you first take a snap shot of | | | | remaining 10% is the most important. This amount is |
| your spending habits. I should tell you that this can be | | | | used to pay you! This habit alone, will increase your |
| very revealing and humbling. For the next 3 days all I | | | | self-worth. This is absolutely the most impactful step of |
| want you to do is log every single thing you spend | | | | this plan. |
| money on, regardless of how small you may think it is. | | | | Remember, 10% of cashflow goes to you first, savings |
| If you buy gum at the store, I want you to write it | | | | account, shoebox, doesn't matter, just get in the habit. |
| down. Large purchases, small purchases, doesn't | | | | 20% goes to pay off old debt, and 70% is what you |
| matter, jot it down. | | | | live on. It may take some time to get to the 70% figure, |
| Once we have this log of your habitual purchases, I | | | | but through dedication and effort, you can do it! |