Client Situation
The people: Ross, 58, and Dorothy, 55, and their two children.
The problem: Dorothy and Ross have a good income; they have a heavy consumer debt load and are living paycheck to paycheck. They had concerns about any unforeseen events that they could not cope with.
The plan: We personalized a Debt Free Living plan to eliminate their debt. We refinanced their house, restructured their consumer debt and accelerated the retirement of their mortgage. The plan improved their cash flow by $1,008.75.
| Creditor | Interest Rate | Payment | Current Balance |
| First Mortgage* |
3.25% |
$2,755.25 |
$268,164.00 |
| Bank I – MasterCard |
0.00% |
Restructured |
$0.00 |
| Bank II – MasterCard |
0.00% |
Restructured |
$0.00 |
| Bank I – Visa |
0.00% |
Restructured |
$0.00 |
| Credit card Co. I – Visa |
0.00% |
Restructured |
$0.00 |
| Credit card Co. II – Visa |
0.00% |
Restructured |
$0.00 |
| Credit card Co. III – Visa |
0.00% |
Restructured |
$0.00 |
| Car Loan |
0.00% |
Restructured |
$0.00 |
| Bank III – Visa |
0.00% |
Restructured |
$0.00 |
| Bank III – MasterCard |
0.00% |
Restructured |
$0.00 |
| Bank II – Visa |
0.00% |
Restructured |
$0.00 |
| Total Debt/Payment |
$3,764.00 |
$350,164.00 |
*First mortgage is accelerated
The payoff: Became 100% Debt Free in 9 years and 5 months, saved $174,235 in interest and eliminated $293,652 in future payments.
If they invest $2,500 (a portion of the total monthly debt payment), once the mortgage is paid off, in just 15 years, they could have $676,290.
Monthly net income: $4,520.
Assets: His retirement funds $35,000; her retirement funds $7,000; residence $550,000; bank savings accounts $1,000; children’s college fund $0.
Liabilities: They have the following debt load.
| Creditor | Interest Rate | Payment | Current Balance |
| First Mortgage |
5.00% |
$1,555.00 |
$175,000.00 |
| Bank I – MasterCard |
18.00% |
$15.00 |
$500.00 |
| Bank II – MasterCard |
8.00% |
$525.00 |
$24,000.00 |
| Bank I – Visa |
18.00% |
$41.00 |
$1,738.00 |
| Credit card Co. I – Visa |
18.00% |
$57.00 |
$2,617.00 |
| Credit card Co. II – Visa |
18.00% |
$391.00 |
$14,000.00 |
| Credit card Co. III – Visa |
18.00% |
$97.00 |
$3,245.00 |
| Car Loan |
9.00% |
$444.00 |
$16,000.00 |
| Bank III – Visa |
9.00% |
$158.00 |
$7,930.00 |
| Bank III – MasterCard |
18.00% |
$163.00 |
$7,930.00 |
| Bank II – Visa |
18.00% |
$318.00 |
$15,204.00 |
| Total Debt/Payment |
$3,764.00 |
$268,164.00 |
Total consumer debt $93,164.00
Total monthly payment $3,764.00
Monthly Mortgage Payment $1,555.00
Monthly minimum Payment $2.209.00
In Summary: Ross, 58, and Dorothy have a Debt Free Living Plan that outlines what to do and when. They are in control of their money and they are on solid financial future.
5715 Coopers Avenue, Suite 2