reddevil's Blog

Tackling credit card debt on a daily basis means instant satisfaction for the card holder. Using techniques that allow you to sacrifice, set short term goals and celebrate the ever-shrinking debt ensure that the repayment process will be a success. Use these daily tips to help eliminate credit card debt.

1. Eliminate the daily coffee. This sacrifice may seem hard at first, but consider drinking the coffee in the office or at home rather than the expensive latte which you have become accustomed to. This small sacrifice pays off and can free up over $100.00 a month to be applied to the credit card repayment budget.

2. Bank the rest. Open a savings account which allows the customer to round up the purchases that they make on their debit card. This money is than put into a separate account which can be accessed at the end of the month to be applied to the credit card debt.

3. Bag your lunch. Bringing your lunch from home comes at 20% of the cost of purchasing a lunch daily! This number is astonishing to those that have been buying lunch for years.

4. Create a chart that you can view daily. Use this chart to tally up how much you have saved for the credit card debt daily and than write it down. Keeping a chart can help to celebrate the small successes that come with creating a savings account to repay credit card debt.

5. Live on cash - living on cash means that you can allocate funds toward credit card debt and stop overspending. For many consumers, the reason that they are facing credit card debt is that they have been overspending.

6. Change your spending habits. Leave your debit and credit cards at home. Find less inexpensive ways to entertain yourself. There are many free activities within communities that families can enjoy, without the high price tag.

7. Enlist the family. With these tough economic times, make it a game. Enlisting the family in contests of who can save the most money or who is the thriftiest shopper can yield a fun and rewarding lesson in personal finances for the children.

8. Use online banking and personal finance tools to track your spending and create a budget that you can live with on a daily basis. With these tools, you can track how much you are able to save in a month by changing only one aspect of your lifestyle.

9. Make one change at a time. Cutting out lunch, the daily coffee, and the weekly trip to the movie theatre can take a toll on lifestyle and family dynamics. Make small changes, this way, the family can adjust to the newly acquired frugal lifestyle.

10. Celebrate once a credit card has been repaid. This time for celebration does not need to be extravagant or expensive, it is a time to reward yourself for all of the hard work that credit card repayment involves!

Trust accounting income is the income and expense items that are used to determine the amount, certain beneficiaries will receive from the trust each year. Generally speaking, it is all revenue less all expenses paid. 

First let’s look at the 2 types of trust funds. A trust that must pay out all accounting income earned in the year is a Simple trust. A Complex trust can pay out dividends and principal to beneficiaries, or can just accumulate the accounting income.

Simple trusts cannot pay out principal, they must be changed to a complex trust to do that. This is why these types of trust funds are popular to give to kids or grandkids, it allows cash flow income, but will not dwindle the source. Also, 2 types of beneficiaries are set-up, remainder and income beneficiaries. If the accounting income has not already been cleared, it must all be paid out at the end of the year to “income beneficiaries”. The principal is preserved for the remainder beneficiaries. Simple trusts cannot have any charitable beneficiaries.

Complex trusts have much more freedom and versatility. Accounting income can be paid out or not. Principal can be paid out or not. And also, complex trusts have the option to utilize charitable beneficiaries. However, charitable contributions, for trusts, have many regulations and stipulations. The contributions must be from the gross accounting income and come from the principal amount. Charitable donations can be deductible if they are paid specifically from the current year’s gross accounting income. Keep in mind, this is if the state and local laws allow for these processes.

The items that are calculated into the asset side of accounting income may include dividends, rental income, royalty income, partnership income, tax exempt interest, capital gain, ordinary gain, and other estate income.

The accounting income liability factors that can weigh in on the expense side are investment fees, fiduciary fees, state taxes, federal taxes, real estate taxes, and property taxes. These fees and taxes are usually paid by both the principal and the accounting income. Although, any arrangement can be made for satisfying these expenses. If the fees are paid by the accounting income, it will decrease the cash flow to the income beneficiary, but the income source will remain producing the same dividends.

Hopefully the asset side is larger than the expense side so that there is accounting income left to collect. If it's not, you need to change accounting services or get a better financial advisor. Since the main objective to having a trust is to gain accounting income and cash flow, it would be counter-productive to have more expenses than income.