Lesson 2: Debt Management Answers

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.IncomeWages$2,278.00ExpensesRent$950.00 Utilities$232.45 Food/Clothes$445.00 Entertainment$270.00 Car$200.00 Credit Card$86.25 Cell Phone$77.89Net Income $16.41

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. Card ACard BAmount$957.00$1,476.12APR11%15%Monthly Payment$18.22$31.21After 6 years, approximately how much will Brandon have saved in interest by consolidating the two balances?

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.

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?

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?

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.IncomeWages$2,278.00ExpensesRent$950.00 Utilities$232.45 Food/Clothes$445.00 Entertainment$270.00 Car$200.00 Credit Card$86.25 Cell Phone$77.89Net Income $16.41

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

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?

Manny wants to find ways to reduce his current debt. The table below shows Manny’s monthly income, expenses and net income. Monthly BudgetAmountIncomeWages$3,000.00ExpensesRent$1,200.00 Utilities$269.34 Entertainment$220.00 Food/Clothes$368.00 Cell Phone$89.42 Credit Card #1$94.62 Credit Card #2$36.18 Car Insurance$80.00 Car Payment$300.00 Gym Membership$25.00Net Income $317.44 After evaluating Manny’s monthly budget, which of the following would be the best option to reduce his debt?

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.

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

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?