Are you maxed out? Credit worthiness is another way to gauge your fiscal health. Do you pay your credit card dues in full or do you pay only the minimum amount due? Would you qualify for a loan? If you have high balances on credit cards, or cannot get a loan or another credit card, chances are that the amount you owe and the amounts you earn and save are out of balance.
If you pay for food, basic clothing, CDs, mobile, electricity and other bills with your credit card and pay only a portion of the bill on a monthly basis, you are living beyond, perhaps, far beyond your means. What about savings and, er, investments? If you have enough cash at hand to address any emergency expenses, live without an income cheque for six months and still have some credit to tap, the next thing to consider is the amount of money that you are able to save and invest.
<bold>Start thinking about saving and investing when you have money left from your income after paying bills, and when your savings account shows some balance.</bold>
But if you do not have an emergency fund (cash or a rich dad), are maxed out on your credit card, cannot get a new card and the bank thinks you are "negative" for a new card or a personal loan, then you are in trouble! The first step is to cut your spending.
So whether you are good at number crunching or not, do get your financial act together and start living on a budget.
