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Working with a budget might avoid too much credit card debt

Some Washington consumers manage to live life comfortably without creating a budget. However, if circumstances change for the worse, living without a budget can be detrimental. Drawing up a budget is never an easy task and may only be successful if a thorough study is made of all money spent over the previous year. This must include all credit card debt and other expenses.

There are certain times when people tend to spend more, such as at the beginning of the school year and over the summer months. For this reason, it is often suggested that studying a full year's expenses gives a person an informed knowledge of his or her own requirements and spending patterns. Going through such a comprehensive list may highlight spending habits that may need to be changed and also specific expenses that can be anticipated.

Once this is done, a list of money owned and debts can provide a clearer picture of what needs to be achieved by drawing up a budget. Comparing assets and liabilities can indicate whether assets need to be increased or liabilities decreased -- or both. The budget can then be drafted with the eye on achieving the necessary change to ensure that there are enough funds to pay bills and meet debt obligations while also building an emergency fund.

Unfortunately, in some cases, consumers may only realize the need for a budget when debts such as credit card debt are already overwhelming. Starting a budget at that stage may be too late to avoid creditor action, repossession, wage garnishments or foreclosure. However, remedies are available, and a consultation with an experienced Washington bankruptcy attorney may be beneficial. A lawyer can explain the requirements to qualify for the different bankruptcy options and the protection offered by the bankruptcy laws, which will allow a consumer to make informed decisions related to his or her financial future.

Source: The Washington Post, "Monitoring your finances may be hard, but not doing it can mean big trouble", Michelle Singletary, Accessed on Nov. 2, 2015

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