By removing several zeros from the Government's figures and rephrasing the official terminology, one can place the debt situation in terms we all can understand - that of a family’s income and expenses.
A family taking in an annual income of $21,700 but spends $38,200 will soon be in dire straights.
The large outstanding balance of $142,710 on the credit card only exacerbates the situation.
Clearly, spending cuts need to be made, but eliminating only $385 from the family’s budget would be a drop in the bucket.
Either a substantially higher amount of income needs to be made, or the family will have to learn to live with less.
Clearly, this "family's" credit status is beyond alarming. The parents must accept the responsibility that has led up to their predicament and avoid shunting the repayments to the kids.
It's not all hopeless... in the household context, by all means start paying down the credit card debt and start managing the card company's expectations by committing to repaying an affordable amount each month. Alongside this, the long road to redemption must also start with initiating some nominal savings to weather the inevitable storms that will appear. Assets like precious metals eg silver should act as a store of value in the long term. Currently priced at around US$30 an ounce, they are worth accumulating.
0 comments:
Post a Comment