According to the Consumer Credit Counseling Service, you should not have more than 15 percent to 20 percent of your net revenue required to pay the debt. Net income is the actual dollars that you take home with you after your employer withheld taxes. You can earn $ 500 a week, but your net income of $ 400 amount, your paycheck is made out of and what you can get when you redeem the check or deposit check into a bank account. So if your weekly net income is $ 400, your debt payments should not take more than $ 60 to $ 80 (0 x, 15 or 20 = debt payment amounts).
Now this does not appear in your mortgage or rent payment, your utility payment, your food or entertainment expenses, or your savings. The debt payments, we are discussing here, is clearly outstanding debts that you are obliged to make payments beyond normal living expenses. Think credit card debt and furniture payments and boat payments.)
And $ 60 for 80 weeks Dollar is to decide how much you can realistically expect to be able to pay per month, multiply by 4.3 (number of weeks in a month) and get $ 258 to $ 344 (or x = 4.3 monthly debt obligation). In case if your debt payments over 15 percent to 20 percent of your net sales, it is absolutely likely that you will take the necessary steps to decrease the monthly obligation.
Debt reduction, which you pay each month on your credit card or installment loan accounts include interest that is added to the principal that you owe each month. And so if you pay less than what the interest amount, your balance will actually increase rather than decrease as you make a payment.
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