Debt Management

Brandon has two credit cards and would like to consolidate the two balances into one balance on the card with the lower interest rate. The table below shows the information about the two credit cards Brandon currently uses. After 6 years, approximately how much will Brandon have saved in interest by consolidating the two balances?

$224.64

Brandon has two credit cards and would like to consolidate the two balances into one balance on the card with the lower interest rate. The table below shows the information about the two credit cards Brandon currently uses. After 8 years, how much will Brandon have saved in interest by consolidating the two balances?

$256.32

Janessa wants to pay off her credit card balances within 12 months. She is trying to decide if she should use her $1,000 in savings to pay off part of the balances or if she should transfer the balances to a new card with a low introductory rate. The new credit card has an introductory rate of 6.5% but charges a balance transfer fee of $50 for each balance transfer. Janessa decides to pay of Credit Card B and $420 of Credit Card A, then transfer the remaining balance of Credit Card A to the new card. Which of the following options shows the amount of Janessa's new monthly payment? Credit Card A: $957 Credit Card B: $580

$50.66

Xi-ling has a net income that is 5% of her monthly salary of $2,315. Xi-ling would like to keep a net income of $50 and put any additional money towards paying down debt. How much more can Xi-ling put towards paying down debt each month?

$65.75

Jose wants to pay off his credit card balances within 18 months. He is trying to decide if he should use his $1,750 in savings to pay off part of the balances or if he should transfer the balances to a new card with a low introductory rate. The new credit card has an introductory rate of 8% but charges a balance transfer fee of $60 for each balance transfer. Jose decides to pay off Credit Card B using his savings and then transfer the balance of Card A to the new card. Which of the following options shows the amount of Jose's new monthly payment? Credit Card A: $1,154 Credit Card B: $1,469

$71.80

Addison has a balance of $3,450 on her credit card that has an APR of 18%. She currently pays the minimum monthly payment of $86.25. If Addison wants to pay off her balance in 24 months, determine the monthly payments she would need to make. Choose the following modification with the least cuts to her current expenses that will allow Addison to pay off her balance in 24 months.

Addison can eliminate $45 from Food/Clothes and $41 from Entertainment.

Tamari has a monthly income of $4,250 and she wants to determine her monthly net income. She calculates that her fixed expenses are $1,955 and her variable expenses are 28% of her monthly income. How much is Tamari's monthly net income?

$1,105

Tyrek wants to lower his credit card debt and has been tracking his expenses for the past month. He found his variable expenses in relation to his fixed expenses. How much of Tyrek's monthly income is left once he pays off his fixed expenses?

$1,890

Marcia has two credit cards and would like to consolidate the two balances into one balance on the card with the lower interest rate. The table below shows the information about the two credit cards Marcia currently uses. After 4 years, approximately how much will Marcia have saved in interest by consolidating the two balances?

$133.92

Marcia has two credit cards and would like to consolidate the two balances into one balance on the card with the lower interest rate. The table below shows the information about the two credit cards Marcia currently uses. After 5 years, how much will Marcia have saved in interest by consolidating the two balances?

$227.40

Caitlin has a balance of $4,880 on her credit card that has an APR of 16%. She currently pays the minimum monthly payment of $105.86. If Caitlin wants to pay off her balance in 20 months, determine the monthly payment she would need to make. Choose the following modification with the least cuts to her current expenses that will allow Caitlin to pay off her balance in 20 months.

Caitlin can eliminate $54 from Food/Clothes and $120 from Entertainment.

Manny wants to find ways to reduce his current debt. The table below shows Manny's monthly income, expenses and net income. After evaluating Manny's monthly budget, which of the following would be the best option to reduce his debt?

Manny could spend less on food and clothes and put the money towards his credit card payment.

MaryKay wants to identify her monthly variable expenses to see if they are more than 40% of her monthly income. MaryKay's monthly income is $3,800. Her net income is 7% of her monthly income and her fixed expenses are $1,824. Determine the total of MaryKay's variable expenses and if they are more than 40% of her monthly income.

MaryKay's variable expenses total $1,710, which is more than 40% of her monthly income.

Which of the following is least likely to be a warning sign that one's debt is at a critical point?

having several credit cards

List three (3) warning signs that a person's may be reaching a critical point in the amount of debt that he or she has accumulated.

Answers may vary but may include mention of credit cards being at their limits, using cash advances on credit cards to pay bills, and/or making late payments.

A couple finds that they are experiencing debt problems and decide to find a credit counseling agency. What are three (3) things that the couple should find out about an agency before they allow the agency to represent them?

Answers may vary but might include mention of the following questions: Are there large up-front fees? Is the agency accredited? How much of each payment goes to the agency?

Mr. Jones has a monthly income of $5,600. He wants to identify his monthly variable expenses to see if they are more than 38% of his monthly income. Mr. Jones has fixed expenses totaling $2,912 and his net income is 12% of his monthly income. Determine the total of Mr. Jones's variable expenses and if they are more than 38% of his monthly income.

Mr. Jones's variable expenses total $2,016 and do not exceed 38% of his monthly income.

Tony wants to pay off his credit card balances within 12 months. He is trying to decide if he should use his $1,000 in savings to pay off part of the balances or if he should transfer the balances to a new card with a low introductory rate. The new credit card has an introductory rate of 7% but charges a balance transfer fee of $75 for each balance transfer. Evaluate Tony's options and recommend the debt management plan that would give him the lowest monthly payment. Credit Card A: $794 Credit Card B: $579

Pay off all of Credit Card A, and $206 of Credit Card B. Transfer the remaining balance of Credit Card B to the new card.

Gina wants to pay off her credit card balances within 24 months. She is trying to decide if she should use her $2,000 in savings to pay off part of the balances or if she should transfer the balances to a new card with a low introductory rate. The new credit card has an introductory rate of 9% but charges a balance transfer fee of $75 for each balance transfer. Evaluate Gina's options and recommend the debt management plan that results in the lowest monthly payment. Credit Card A: $1,354 Credit Card B: $1,678

Pay off all of Credit Card B and $322 of Credit Card A. Transfer the remaining balance of Credit Card A to the new card.

Which of the following choices is not a step that can reduce your spending?

purchasing reduced fat lattes during the week