Will You Succumb To Debt? Take The Debt Test

Financial disaster caused by excessive credit card and other debt can creep into daily living with treacherous and cumulative effects. There are leading indicators that can help determine whether or not you will succumb to debt. Take the Debt Test to find your level of debt contamination.

Answer the following 25 debt-related questions. Total your YES points. Then, find your Debt Range at the bottom to determine the likelihood of succumbing to debt.

- A collection agency has contacted me about unpaid bills (10 points)
- I have one or more leased vehicles (5 points)
- I am making some minimum monthly payments on credit card debt (5 points)
- I charge purchases to credit cards that were previously paid for in cash (5 points)
- I have elected to not carry health insurance (10 points)
- I have elected to not carry vehicle insurance (10 points)
- I have elected to not carry homeowners or renters insurance (10 points)
- I worry or lose sleep over my financial situation (5 points)
- My wages are being garnished or assigned (10 points)
- I skip credit card payments in order to pay for food, shelter or utilities (10 points)
- I am behind in paying for housing, vehicle or utilities (10 points)
- I am occasionally late in paying bills or sometimes incur late fees (5 points)
- Family relationships are strained as a result of money problems (5 points)
- I borrow or transfer money in order to pay bills (5 points)
- 40% or more of take-home pay goes to pay off debt (10 points)
- I do not have at least 3 months living expenses held in savings (10 points)
- I have given thought to filing for bankruptcy (10 points)
- I have thought about starting a debt consolidation plan (5 points)
- I use or have used "cash advance" or "payday loan" services (5 points)
- I use a home equity line of credit to pay credit card debt or other bills (5 points)
- My debts are increasing while my income is the same or decreasing (5 points)
- I am in the process of or near foreclosure or property repossession (10 points)
- A money-spending plan or budget is something I do not use (5 points)
- My credit cards are at or near the spending limits (10 points)
- I don't balance my checkbook each month (5 points)

Total your YES" POINTS to determine your Point Range indicated below.

POINT RANGE:
- 0-15 Congratulations! You appear to be doing a good job of controlling your debt and managing your finances. Being debt free can eventually lead to personal financial freedom.

- 20-35 You may be headed down the proper financial path but a review by a qualified financial planner might be a good idea.

- 40-65 Your financial condition may be a concern. A financial assessment by a licensed financial planner is recommended.

- 70-95 Your financial condition could be serious. Debt counseling help is something you should seriously consider.

- 100-185 Your financial condition may be critical. Debt counseling help is essential.

Add to Onlywire

Insider Truths Of The Wealthy

There is a good article that contains an important belief that is common among individuals who have accumulated significant wealth.

It took me years to realize the full impact of this uncomplicated statement:

"Those who do not promote, market, and sell the value they personally possess, combined with their useful product or service will always be under the control of those who do."

Most wealthy people meet this criteria. Additionally, they typically maintain a debt free lifestyle with the ability to generate significant income despite the influences of other people, the economy, the stock market, and other external factors.

Conversely, individuals who are not self-employed possess value to an employer but they don't meet all of the criteria indicated above.

An employer, not an individual worker, determines:

• Salary
• Raises
• Eligibility for promotion
• Job responsibilities
• Work location
• Hours
• Benefits
• Other employment factors

To read the full article that also includes two common myths about personal wealth and financial freedom, click here.

Add to Onlywire

DON'T BE EMBARRASSED BY DEBT—YOU'RE NOT ALONE

Heavy debt can trigger a lot of unpleasant emotions. Embarrassment is one of the most common and most dangerous feelings we can experience.
Whether you have to look your kid in the face and tell them you can’t afford to sign them up for their favorite sport this year or your credit card gets rejected by some disdainful teenage teller at the mall because it’s maxed out, debt problems can make the toughest adult turn red in the face and feel like hiding.
This response is natural, but it’s also dangerous because it just makes us want to run away instead of deal with the problem. Americans, in particular, are very secretive about their personal finances, and embarrassment can send them deeper into hiding.
One way to beat your embarrassment so that you can begin to grab the debt bull by the horns is to understand that you are not alone. If you have significant debt, you’re not even in the minority. You’re in the same big boat as most of your countrymen. Here are just a few of the latest indicators:
By age 65, 96% of Americans will either be dead or dead broke! Only 3% will reach financial independence, while only 1% will become rich.
According to the Wall Street Journal, a staggering 70% of Americans live paycheck to paycheck.
The American Bankruptcy Institute lists over 2 million bankruptcies in 2005, a huge 30% increase over 2004 and more than 98% were personal. In the first three months of 2007, bankruptcies were up 66% over the same period last year.
Are you a woman with kids? Then, look out! According to the 2003 book The Two-Income Trap: Why Middle-Class Mothers & Fathers Are Going Broke, having a child is now the single best predictor that a woman will end up in financial collapse. – Harvard Professor Elizabeth Warren and Health Benefits Consultant Amelia Warren Tyagi
This isn’t to say that you should just throw up your hands and sit back because everybody has these problems, but it does mean that there are some pretty wide-spread forces at work that helped you get where you are today. Some of these economic, political, and social forces have quietly slipped into our daily lives. And the better we understand who and what is behind this rampant explosion of personal debt, the better we can begin to bring our personal finances under control and get back on the road to financial freedom.


Add to Onlywire