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Personal Budgeting Basics: Means Test Your Way Out of Debt

Personal Budgeting: How To Means Test Your Way out of Debt

There are a few time tested methods to get debt free.  Many of these methods have been told to the younger generations by the mouths of wise men and women through the years.

One of my favorite quotes is by Ben Franklin in his timeless book, ‘Poor Richards Almanac.' Mr. Franklin said,

"The use of money is all the advantage there is in having money".

Did you know that you can use your money to your advantage and get debt free using only your current income? In this article, I'll tell you how but it will only work if you have an open mind.

You've probably heard the phrase "ends justifying the means". This saying speaks to the morality of the actions you take while trying to get what you want.  If you are overwhelmed by debt you obviously want to get out. The most moral way to get debt free to is pay your debt.

One of my all-time favorite quotes of wisdom is from the 30th President of the United States, Calvin Coolidge. Mr. Coolidge said,

"There is no dignity quite so impressive...and quite so important, as living within your means."

U.S. Courts take Means Testing Seriously. In fact, did you know that under the Bankruptcy Law of 2005, The U.S. Trustee Program has the authority, (under the U.S. Department of Justice) to require Consumers filing Chapter 7 Bankruptcy...to first undergo a 'Means Test'?

It's true, and if the Means Test result is that the Consumer has the income to pay, the Consumers' Bankruptcy filing can denied.

I'm not sharing these facts to scare you and this is not legal advice. I'm hoping to open your mind to the idea of undergoing your own Means Test.

How To Use a Means Test to Your advantage.

I believe you can live wealthy but only when you are living within your means. So, below I've provided a three (3) question Means Test.

Be warned though. You may find some of my budget considerations to feel a little radical. That's OK... My point is to open your mind to considering your current means to justify your path out of debt and into more wealth.

So, here are the 3 questions that you can ask yourself, to conduct your own informal Means Test.

1. How many Creditors do you have?

A Creditor is anyone who has provided a product or service that you have not fully paid back. Good examples are Credit Cards, Mortgage, Installment Contracts etc.  A good question to ask yourself is, "which of my Creditors will work with me voluntarily?"

2. How many Liabilities do you have?

Liabilities are things that take money out of your pocket. Sometimes liabilities are necessary. For instance, we can not live without food and shelter. But there are other Liabilities that most people can probably live without. It's up to you to determine what liabilities you absolutely need and ones you can do without.

My point is that if there are things taking money from you and you don't really need them for survival, consider cutting them from your budget. This step alone can be a means that justifies the end of your debt.

3. How many Assets do you have?

Assets are things that provide income. Anything that can put money in your purse or pocket...can be considered an asset. For example, jewelry a vehicle, and electronics are things that you can sell or "Liquidate" to get money to pay off your debt.

Assets are often an overlooked budget category. So is the idea of Asset Liquidation. In the age of ebay and other online sales hubs selling off anything of value, you can sell anything you don't really need but may have value to someone else.

Everyone in debt will do their budget a great service if they ask themselves those three Means Test Questions above.

About the Author

Carlton Ford is a former Legal Assistant in a Bankruptcy Prevention Law Firm and Founder of the  "Consumer Credit Boot Camp®". To discover more valuable budget building tips and tools click here.

Bt home hub and xbox live nat settings?

I have recently set up xbox live and was able to play for a day or two on Call of Duty 4 and went to go on it again and couldnt connect to any lobbies so i tested the network connection all fine apart from the NAT which said strict i have tried reseting the Bt Home hub and it doesnt work please help thank you
Anthony

you should try setting the firewall ruls on your router... to set it go to Start>Run>CMD>ipconfig there you should see default gateway... enter this address exactly as it is on your web browser.. good luck !

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