Some of the most common reasons for being broke stem from sudden, potentially unforeseeable situations, such as medical expenses, theft or uninsured accidents, that damage personal assets. As of 2014, medical costs cause the largest portion of personal bankruptcy filings, even with health insurance.Know More
Loss of a job, poor or excessive use of personal credit, and student loans also contribute to overall levels of debt and monetary constraints. Those closer to the poverty line are more likely to have issues with money constraints. As of 2011, 60 percent of those claiming bankruptcy earned $30,000 or less. Those who have some college education are at higher risk for monetary issues, as the burden of student loans combined with fewer high salaries associated with a college degree increases bankruptcy risks.
Stagnation of household income can contribute to monetary problems, making it difficult to save for emergencies, as prices for utilities, food and other basic needs increase when wages do not. Divorce can also be a very expensive drain on resources; legal fees, division of marital assets and child custody can all contribute to someone being broke. Poor financial education in schools can also contribute to poor personal budgeting issues, reflecting in individuals with spending issues or bad budgeting skills.Learn more about Financial Planning
Although details of 529 plans vary from state to state, basic rules are that each plan has a single custodian and beneficiary, the funds in the plan are administered by the custodian until they are disbursed, the funds can be used only for education-related expenses and total contributions cannot be greater than qualified educational expenses. These expenses include tuition, room and board, books, fees, supplies, and computer software and hardware.Full Answer >
The advantages of a living trust are determined by the amount of property owned, and legal expenses related to creating a trust versus a will. In general, large property assets are more suitable for a living trust. Asset privacy is another advantage a trust has over a will.Full Answer >
Cash inflow refers to a business or company's sources of money or income, while cash outflow refers to a business or company's expenses. A business survives if it can generate a larger cash inflow versus a cash outflow.Full Answer >
To write a basic income statement for a financial period, calculate expenses and costs of goods sold, and then subtract the sum from revenues. Showcase the obtained figure as the last entry in the statement. Write the entity's name, the title of the statement and the respective financial period on the top.Full Answer >