It’s no secret that many Americans struggle to pay their bills. It’s even stranger to think how many in “middle” class live nearly paycheck to paycheck, but consumerism and marketing are hard to avoid.
It’s likely that the numbers of Americans that are actually in the red based on the mortgage they hold, the car notes they are paying, and the credit card debt they are servicing is far more than any research we’ve ever seen.
In fact, many of the same challenges that affect the truly poor also affect the middle class – debt repayment, unhealthy diets, and long-term financial planning.
Stress about finances can even result in people feeling physically ill.
Many households struggle with debt, and when they don’t know where else to turn, they sometimes take on even more debt from HELOCs or another credit card. These might give people “a minute to exhale,” but the underlying problems – an inability to effectively manage money – are still there, after the introductory rates are gone and the equity in a home is stripped away.
So what can you do?
Any time you find yourself digging a hole you can’t get out of, the first step is to stop digging. Do you actually have a budget? Where are you wasting money?
Honestly, it could simply be a poor understanding of your tax liabilities and a trip to see me and my team could help you resolve it. At the same time, when you actually look at what you spend – and where you spend it – each month, I’m willing to bet that you find a lot of holes in your bucket.
A dinner out here, a lunch there, an overpriced coffee four days a week. All this adds up and if you buy consumables – or any consumer goods – on credit, then you are effectively paying an extra 20% (or whatever the interest is) on those items.
Did you buy a big screen television on a credit card? Are you driving an expensive car to “keep up with the Jones’?”
Here’s a hint – pay cash. Yes, even for cars. In fact, pay cash for anything that you either consume or that will not appreciate in value. Unless you can write off a purchase as a deduction or an asset, try not to take on the debt.
Improving your financial situation is not easy. It’s hard. Like, really hard. But it can be done. But you have to want to do it and not be afraid of what others might think of your decision. The number of millionaires I know who live humbly is amazing, but the number of middle class people I know who act like they have a million dollars in their accounts is overwhelming.
If you or your clients have any tax issues or problems with the IRS/State or other federal tax problems, please feel free to contact me directly at (909) 570-1103 or by email at Carlos@HealthcareTaxadvisor.com
Carlos Samaniego, EA
Enrolled Agent
Licensed by The Department of Treasury to represent taxpayers
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1255 W Colton Ave, #535
Redlands, CA 92374
Ph. (909)570-1103
Fax (909)586-9190
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