Gen 200 - Financial Difficulties

Luis D Maymí Romero

University of Phoenix

Foundations for General Education and

Professional Success / Gen 200

Dra. María de Lourdes Ferrer

September 17, 2009

Financial Difficulties

Know a day's one of the present problems affecting the everyday labor on every household is the financial difficulties that present themselves on a daily and monthly basis. With the unemployment on a rise and various companies making cut backs it has made difficult for families to adapt and recover from financial problems. Some of those problems are bankruptcy, business failure, debts, late fees, evictions, and foreclosures just to mention a few.

Unplanned and unexpected spending is one of the main sources to having financial troubles and in some cases people might think that's a very wise idea to ask a lender for a high risk loan. Yes this could solve all your troubles. It will give you some peace of mind but only for a short period of time. In the case of most lenders they prefer a borrower who owns valuable security to be placed as collateral against the loan and hence, tenants or individuals who cannot place any collateral, find it difficult to secure a high value loan easily.

Now the real question is what should I do? And the answer is real simple if you have the time to sit down and analyze your finances. There are many financial consultants available that can help you evaluate how you are spending your income. In many cases you don't know where your money is going. One of the recommendations that will be provided is that you eliminate all your bad debts first. Also you can minimize your entertainment spending to a zero if possible. The only thing that is common between every financial consultant is that from your income at least Twenty percent (20%) should be headed for your savings account. According to BPPR (2009) if that's impossible right now, start by saving even a small amount from each paycheck.

In some cases the financial problems don't have anything to do with savings, instead the problem comes from involuntary unemployment. Doesn't mater how many year you've been working with this company if they need to cut back they will do it regardless of your position and years of sevice. As mentioned by the Washington Senate Democratic Caucus in January 15, 2008. As feared, the nation's unemployment rate jumped to 7.2 percent in December from 6.8 percent in November. Employers cut 524, 000 jobs in December, and many economists