The secret to paying off debt is simple – you need to spend less than you bring home in order to have extra money to pay your bills. For more information, contact your Member Service Representative today at 1-800-533-4004 or log on to www.endurafinancial.com.

Watch Out for Rising Debt

Personal debt is something that affects virtually everyone. Spending is a lot more fun than saving, and a strong economy encourages consumers to loosen the purse strings. But extending your spending beyond the limits of your income can have significant consequences.

Some studies reveal that the average American family carrying a credit card balance already owes more than $8,000. However, that number is skewed because it takes the total debt divided by the number of households with credit cards. In reality, many families owe less than $2,000 in credit card debt. More notably is that the personal savings rate is negative for the first time since the Depression.*

The challenge is managing the debt you have and learning to judge whether assuming more debt makes financial sense or not.

Warning Signs
If more than 20% of your paycheck goes toward paying off credit cards and loans (aside from your mortgage), you may be getting in over your head, according to the National Foundation for Credit Counseling. You also may be reaching a danger zone if:

• You can only pay the minimum required on your credit cards.
• You charge essentials like groceries, gas or other household bills, unless you're doing it to earn airline miles and pay off the card each month.
• You couldn't cover the basic costs of living for 6 months if you lost your job today.
• You're paying your bills late  or not at all.

Spend All Your Money on Your Debt...?
The secret to paying off debt is simple – you need to spend less than you bring home in order to have extra money to pay your bills. The first step is to put together a spending plan, cut your expenses and try to avoid adding any more debt until you get your existing debt under control.

What are the advantages of using all available funds to pay off debt? You'll be able to pay it off faster, for one thing. For example, if you have $5,000 in credit card debt at 18%,* you could pay it off in 11/2 years by paying $320 a month. If, instead, you put $100 a month into savings and pay $220 a month on your credit card bill, it will take an additional year to pay it off.

Paying off debt before building savings will also save you money, assuming the interest rate on the debt is higher than what you earn on savings. In the example above, you'd pay an additional $423 in interest charges by stretching out payments over 21/2 years rather than paying it off in 11/2 years. A savings account earning 5%* would pay you $202 over the 21/2 years you were building it at the rate of $100 a month. So you'd be better off (to the tune of $221) concentrating on the debt first.

...Or Build Savings at the Same Time?
By adding to savings while paying off debt, you may avoid the need to use credit in the future. Say your car suddenly needs $400 in repairs, for instance. If you have that money available in a savings account, you can pay cash and spare yourself the interest payments you'd owe on a credit card.

We'll Help You Find Solutions
Which strategy is best for you depends on the interest rate you pay on debt and the rate you earn on savings. For more information, contact your Member Service Representative today at 1-800-533-4004 or log on to www.endurafinancial.com.