San Diego, CA. According to some experts,
some 70 percent of all adult working Americans have no money left after
paying their basic expenses and bills each month. "Many are out of kilter,
financially speaking, and they don't even know it," said Paul Richard,
executive director for the nonprofit Institute of Consumer Financial
Education (ICFE), a San Diego based group helping consumers become better
spenders, regular savers and wise users of credit.
"How do you tell if you are financially out of kilter, or in danger of
being there? There is a simple formula that most retail lenders rely on to
determine if a loan applicant has too much debt and out of kilter,"
explained, Richard. The formula is: monthly take home pay, less housing
expense (rent or first mortgage) equals X multiplied by 20 percent equals
the total amount of money you should be paying towards loans, credit cards
or other debts.
EXAMPLE Monthly take home pay is $2400. Less housing expense: $800
a-month, equals $1600 multiplied by 20 percent equals $320 maximum amount
to be paid on car or other loans including charge cards. "Consumers who
apply the formula to their own finances and find they have too much going
towards charge cards and loans have limited choices to in order to alter
their course. They need to increase income or reduce outgo, if possible,
by refinancing, and sometimes, by a consolidation loan," Richard said,
adding, "The next focus is spending, because that's the key to debt
reduction and, eventually, savings and investing for the future."
Take Home Pay: $2400
Less Housing (-800)
Balance $1600
x 20%= $ 320 available for credit payments.
"The ICFE has a wide variety of aid for consumers, especially those who
find themselves out of kilter," said Richard, whose group has helped
thousands of people through its Web site at:
http://www.icfe.info.
For information about "Mending
Spending," monthly budgeting guidelines, and
warning labels for your charge cards, visit the ICFE's Web page at:
http://www.icfe.info.
The site also includes helpful sections on
increasing savings,
using credit wisely, plus "How
to set up
and implement a spending-plan" (with a one page work sheet) for
personal and/or family finances. To receive the same information by mail,
please send $1 and a self-addressed, 60 cent stamped envelope to:
ICFE Money Helps
PO Box 34070
San Diego, CA 92163-4070
About the ICFE:
The Institute of Consumer Financial Education (ICFE),
founded in 1982 by the late Loren Dunton - creator of the “certified
financial planner” (CFP) designation - is dedicated to helping consumers
of all ages to improve their spending, increase savings and use credit
more wisely. The years between 1984 and 2000, the ICFE was also known as
the National Center for Financial Education (NCFE).
The ICFE is a nonprofit consumer education organization that has helped millions of people through its education programs and resources. Over
one million “Credit
/ Debit Card Warning
Labels” and “Credit
/ Debit Card Sleeves” are in circulation world wide.
The ICFE’s on-line help for consumers who spend too much
was featured in PARADE Magazine (June 9th, 2002) in the Intelligence
Report section. The money helps and tips are from the “Money
Instruction Book,” a course in personal finance, which was completely
revised and updated in 2002 and is positioned to become among the premier
programs in the new bankruptcy and debtor education initiatives.
The ICFE’s “Do-It-Yourself Credit File Correction
Guide,” now in its Twelfth Printing, is in use by thousands of consumer credit and debt
counselors in addition to tens of thousands of consumers. It received a
“buy” rating in July, August and November from nationally syndicated
financial columnist, Humberto Cruz in his column, “The Savings Game".
BottomLine Personal newsletter gave the Guide a “Send For” rating in
September 2001. The ICFE and our do-it-yourself approach to credit file
correction was featured on NBC Nightly News on 04-30-02. The Spanish
edition of the Guide premiered in January 2002. Syndicated columnist,
Robert Heady also gave the ICFE Guide a “buy” rating.
The ICFE Web site at: www.icfe.info helps consumers with
mending spending, learn about the
proper use of credit, budget and expense guidelines, how to set up and implement a
spending-plan and also access financial education courses and videos and how to
teach children about money. Other ICFE services include a
free eNewsletter, and an
on-line resource center of financial education
learning tools, including videos, books and personal finance courses.
Consumers may learn more on the Internet about the "Do-It-Yourself
Credit File Correction Guide" here, or fill out our request
form, indicating your areas of interest.
For more information contact Paul Richard ICFE Executive Director at 619-239-1401.
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