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Know your financial situation to recover from debt

Media Contact: Catherine Dehdashti, University of Minnesota Extension, (612) 625-0237, ced@umn.edu
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ST. PAUL, MINN. (2/2/2011) —Many people make New Year's resolutions about their finances. One common resolution is to get out of debt; another is to start a savings account.

If you haven't yet made much progress with your financial resolutions this year, one simple thing will help you get started.

"The first thing that will help you get control of your money is to take a good look at your financial situation," said Rosemary Heins, a family resource management educator with University of Minnesota Extension. "Gather your income statements, bills and receipts and figure out what you have coming in and what you have going out."

For a simple, easy-to-use monthly spending plan, visit Extension's website at www.extension.umn.edu/GO/1054.

Subtract your expenses from your income to find out how your situation is balancing out. "If you have some money left over, make a plan to start a "rainy day" fund instead of spending beyond your needs," said Heins.

She adds that there is no easy answer if you find that you have a negative balance every month. You will have to find a way to either increase your income or decrease your expenses, or both.

"I recognize that it's not easy to increase income in these difficult economic times," Heins said, "but taking the first step of knowing your financial situation will help you gain the control you'll need to create a debt-recovery plan."

For more information and resources for families experiencing tough financial times, visit www.extension.umn.edu/toughtimes.



Source: Rosemary Heins, family resource management educator, University of Minnesota Extension

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