According to the CCC [Consumer Credit Counseling] service, you should not have anything other than 15% to 20% of the net income owed to you. [Net income is the actual dollar you bring home after the employer withholds taxes.] You may earn $500 a week, but your net income is the $400 you paid for your salary and the amount you can get cashed checks Or deposit it in a bank account. Therefore, if your weekly net income is $400, your debt payment should not exceed $60 to $80 [$400 x 15 or 0.20 = debt payment amount].
Now this does not include your mortgage or rent, utility payments, food or entertainment expenses or your savings. The debt payments we discuss here are just the outstanding debts you need to pay, which exceeds the normal cost of living. [Think about credit card debt and furniture payments and boat payments.]
The weekly WEDK is $60 to $80, so to determine what you can actually pay each month, you must multiply by 4.3 [weeks in a month] and then get $258 to $344 [$60 or $80 x 4.3] = monthly debt obligations]. If your debt expenditure is equivalent to 15% to 20% of your net income, then you will most likely need to take the necessary steps to reduce your monthly obligations.
The monthly debt relief payments you make on your credit card or installment loan account include the monthly owed interest on your principal. Therefore, if the amount you pay is less than the interest amount, your balance will actually increase rather than decrease when you make a payment.
Orignal From: Debt consolidation and debt management
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