HOW TO DO YOUR OWN

DEBT CONSOLIDATIONAnd.....Reduce Your Monthly

Payments, too!

by J.F. (Jim) Straw

J.F. (Jim) Straw204 Wildflower Way Dalton, GA 30720-8029

eMail: jfstraw@BusinessLyceum.com

This publication is designed to provide accurate and authoritativeinformation in regard to the subject matter covered. It is sold with theunderstanding that the publisher is not engaged in rendering legal,accounting, or other professional services. If legal advice or other expertassistance is required, the services of a competent professional personshould be sought.

HOW TO DO YOUR OWN

DEBT CONSOLIDATIONAnd.....Reduce Your Monthly

Payments, too!

by J.F. (Jim) Straw

- 1993, J.F. (Jim) Straw All rights reserved.

ForewordForewordForewordForewordForewordWhen you have learned that 2 + 2 = 4, you have gained a useful

piece of information. - When you have learned that 2 apples + 2 apples= 4 apples, but, that 2 apples + 2 oranges = 2 apples & 2 oranges, or 2 pairsof fruit, or 4 fruits, you have gained all-important knowledge.

Information is nice to know. It lets you answer the questions ontests (or when watching TV game shows). But, until you learn to use thatinformation in a practical application, it isnt knowledge.

Any child of 2 or 3 years of age can tell you that 2 + 2 = 4. They haveheard it repeated, over & over, until they can repeat it themselves. But,when confronted with 4 apples, they are at a loss to apply that information.

The same holds true for older students (and even adults) who canreadily tell you that Einsteins Theory of Relativity can be expressed bythe formula, E = MC2. - Until they know what the E, M & C stand for andcan use the formula in a practical application, it is only information, notknowledge.

A fine line exists between information and knowledge. That fineline is nothing more than use. -- You can memorize bits and pieces ofinformation all day, every day, but, until you actually use that information,it is not knowledge. Once used, information becomes knowledge and,thereby, power.

SUCCESSFUL PEOPLE; whether they be self-employed or wage-earners, executive or common laborer, are seekers after knowledge.They absorb information from every direction. The information theycan use becomes knowledge, while the information they have noapparent use for is simply stored on the chance that someday it maybecome useful.

UN-SUCCESSFUL PEOPLE, on the other hand, claim to be seekersof knowledge, but, they believe that knowledge itself can be imparted.Because the books they read, the courses they take, and the plans theybuy contain only information., they are forever disappointed. Becauseit is ONLY INFORMATION (not the knowledge they thought theywere going to get), they never use the information and, thereby, theknowledge they sought is lost to them forever.

Since I am the author of a great many books, booklets, reports,articles and editorials about success and making & using money(somewhere over 300 so far), those people stick-out like sore-thumbs onmy customer lists. They write me long letters detailing their trials and

tribulations and explain to me just why the information wont work forthem. But, not one ever writes to say I used the information and itdidnt work. - Had they ever used the information, that informationwould have turned into knowledge and they could have reaped therewards they have coveted for so long.

If there was a way I could force those people to use the informationthey have, I could literally GUARANTEE their success. And, in thosefew cases over the years where I have been able to shame or intimidatepeople into actually using the information I have provided, those peoplehave achieved successes they had only dreamed were possible.

The RULES OF SUCCESS used by successful people & businessessince the beginning of time have never really changed. Those rules havebeen written-down for all to read, learn and use, but they appear asinformation only and can only be changed to knowledge by use. Ifthere were a way to force every person and every business to usethose known and proven rules of success, there would be NO UN-successful people or businesses in the world.

Statistically, 90% of small businesses fail, and 90% of people live alife of sustained mediocrity, simply because they will not use theinformation available to them.

In your quest for financial independence you MUST learn to forceyourself to use the information you have at your disposal. -- No one (butYOU) is going to force you to assume that responsibility.

Of course, some smart aleck reading this is going to say, Yeah!But, Im not going to use any bad information.

Granted, there is bad (counter-productive) information out there.BUT - there is NO WAY of telling good information from bad information,UNTIL YOU TRY IT. Judging the value of information without using itis like trying to judge the flavor of a pie without ever tasting it.

If you learn nothing else from this course, learn that informationonly becomes knowledge when you use it - and - the information youhave used or failed to use in the past is the reason you are where you aretoday.

YOU can be your best friend, or your worst enemy. No one forcesyou to be what you are, or do what you do (or dont do). - What you havetoday is a direct result of what you did yesterday. What you will havetomorrow will be a direct result of what you do (or dont do) today.

It's up to you!

HOW TO DO YOUR OWN

DEBT CONSOLIDATIONAnd.....Reduce Your Monthly

Payments, too!What you are about to read IS NOT just a re-hash of the same old

stuff you've read for years & years about credit and finance. It is allwritten from my own personal experience. I know it works (and willwork for you) because I have done it myself.

Starting out with nothing; as the son of an aircraft worker/sharecropper in Oklahoma & Kansas, I became a multi-millionaire BUT it took me nearly 30 years because I had to learn the secrets thehard way. I didn't get rich overnight. You won't either - but - you arebetter off than I was because you get to learn from my experience. Wherever you are right now financially, I've been there.

Then.....in 1983.....I bought a bank and became a "banker." That put me on the other side of the desk, so now I can see both sides.

Those experiences of mine have made it possible for me to findsolutions that YOU can use to SOLVE YOUR MONEY PROBLEMS solutions you won't find anywhere else.

So.....find a quiet place and join me as I share with you how YouCan Do Your Own DEBT CONSOLIDATION.....and.....Reduce YourMonthly Payments, too!

You've probably seen the ads everywhere offering "DebtConsolidation Services - Not a Loan." Although there are somecompanies that do provide those services, for the most part, those whoare running the ads don't. Instead, they will charge you anywhere from$50 to $200 just to give you the names & addresses of the very fewlegitimate companies that provide the service. - BUT - You can do ityourself cheaper & better. (After I explain what these companies do;and how they do it, I'll GIVE YOU the name & address of the best in theindustry.)

The ONLY reason most people use these "Debt ConsolidationServices" is because, plainly & simply, they don't know how to do itthemselves because our education system doesn't teach our youngpeople anything at all about money and credit. (The only other reasonsome people use the Debt Consolidation Service companies is becausethey KNOW they cannot handle their money, so they get thesecompanies to handle their money for them.)

2Believe it or not.....using the system in this Special Report, youwill also be able to REDUCE YOUR MONTHLY PAYMENTS while youre-structure your finances.

This is a complete step-by-step, point-by-point plan that can beused by almost anyone. You'll be absolutely amazed how easy it reallyis.....and.....you save a lot of money not dealing with the flim-flamartists.

But.....before we get into doing your own DebtConsolidation.....first, let's see.....

WHAT IS A DEBT CONSOLIDATION SERVICE?Before they were known as "Debt Consolidation Services," the

companies that provide such services were known as "AcceptanceCompanies." What they do is "budget" your income so all of yourcreditors get paid something on your debts each month.

In order to use an Acceptance Company (budgeting service), youfirst make a list of all the people to whom you owe money, how muchyou owe them, and what your monthly payments are.

When the Accceptance Company receives that information, theyreview your situation and establish a budget schedule for you. Then,each time you get your paycheck, you send them the amount of moneythey have scheduled for you. The Acceptance Company contacts yourcreditors and arranges to pay them for you (a little at a time) from themoney you send to the Acceptance Company; until your bills are paid-in-full. You have only ONE (1) payment per month; to the AcceptanceCompany.....they just pay your bills with your money, for you.

Because the Acceptance Company IS NOT lending you any money,there are (as their ads say)...NO Credit Checks...NO Co-signersrequired...NO Collateral Requirements...and your age, marital status,source of income, and length of employment are not considered.

The Acceptance Company charges you a Fee for maintaining yourbudget account and paying your bills usually figured as a smallpercentage (less than 1%) of the total amount of your bills; per month.

Your creditors will usually accept this arrangement readily,because it means they will be getting paid on your account and won'thave to go through legal channels for collection, etc.

Unfortunately, MOST of the companies that offer DebtConsolidation Services; or Acceptance Company services, are a littlebit iffy, at best - however - over the years, I have had dealings with onecompany that really does the job and does it well. So.....if you want areal professional company to handle your credit for you, they are theonly one I would recommend. They ain't cheap, but you get theprofessional services you pay for. They are.....

3CREDIT-CARE, Inc.Sponsor #743

P.O. Box 13007Birmingham, AL 35282-9265

Contact them if you are really serious about CLEANING UP YOURCREDIT - and you're willing to pay for a professional to help you do so.

But.....you can Do Your Own DEBT CONSOLIDATIONAnd.....Reduce Your Monthly Payments, too.....yourself.

Before we begin consolidating your debts, let's find out.....

HOW BIG ARE YOUR DEBTS?When you look at that stack of bills you have to pay each month,

you probably think your debts are too big to deal with.....but.....let'sfind out for sure.

The first thing I want you to do is add-up all of your bills for one(1) month. NOT all the things you bought last month; just the BILLSYOU MUST PAY EACH MONTH.

Now.....MULTIPLY that amount by 12 (months).....DIVIDE thatamount by 52 (weeks).....then, DIVIDE that amount by 5 (workingdays).

As an example: If your monthly bills totalled $1,000 yourcalculations would look like this:

1,000 x 12 = 12,000 52 = 230.77 5 = 46.15The amount you end-up with in our example: $46.15 is the

AMOUNT YOU OWE EACH DAY.After you have finished your calculations, write it down here:

I OWE $__________ PER DAY.Your next step is really very easy. Just DIVIDE your TAKE-

HOME PAY by the NUMBER OF DAYS in your pay period. If you arepaid weekly, divide by 5. If you are paid every 2 weeks, divide by 10. If you are paid monthly, divide by 22.

By the way, your TAKE-HOME PAY is the amount of yourpaycheck after all of the deductions are taken out for taxes, insurance,etc. The amount you actually take-home.

The amount you end-up with is the AMOUNT YOU EARN EACHDAY. Write that amount down here:

I EARN $__________ PER DAY.

REMEMBER: If you have more than one paycheck coming in(husband & wife), you need to do the same calculations for eachpaycheck and add the amounts together.

Now.....compare the amount you OWE per day with the amountyou EARN per day.

No Lo

nger

Avail

able

4If you are like most people, you will be pleasantly surprised tolearn that the amount you EARN is more than the amount you OWEper day. Of course, the more you have left of your earnings per day,after subtracting what you owe per day, the better-off you are. But,as long as you have something left-over each day, you are in goodshape to start your own debt consolidation program.

On the other hand, if the amount you OWE per day is more thanthe amount you EARN per day, you can still set-up your own debtconsolidation program IF you just follow through on the very simplemethods I'm going to tell you about later on. Don't give up yet. Staywith me.NOTE: For all of you whether you OWE more than you EARN or not later on, I'm going to show you how to REDUCE YOUR MONTHLYPAYMENTS so you'll be able to eventually catch-up on your bills andget ahead of your debts.

Most people are really surprised after they figure out how muchthey OWE PER DAY and how much they EARN PER DAY.

They've always looked at their monthly bills as ONE BIG AMOUNTto be paid each month ....and.....their paycheck as ONE SMALLAMOUNT to pay those bills with. When they finally look at thoseamounts on a PER DAY basis, they see for the first time just how big,or how small, the difference really is.

NOTE: If you really, really want to be surprised, DIVIDE the amountyou owe per day and the amount you earn per day by 8 (hours). It isreally amazing what just a few pennies per hour can do to your overallsituation.

Once you KNOW how bad your debts really are by reducing themto a daily (instead of weekly or monthly) amount you will be betterprepared to deal with the situation. That means, you will have to dothe calculations to find out how bad your debts really are.

Whether or not you do those calculations, you WILL have todecide.....DO YOU WANT TO SOLVE YOUR MONEY PROBLEMS? OR DO YOU JUST WANT TO STAY THE WAY YOU ARE?

Now that we know how bad your debts really are.....let's findout.....

WHAT CAUSED YOUR DEBTS?Unfortunately, in a nation that spends billions of dollars on

education, we have NEVER effectively taught our young people aboutmoney and credit. As a matter of fact, we let them grow-up almosttotally ignorant of money matters. Then, we condemn their improperuse of credit and blame them for the problems they encounter indealing with money in their daily lives.

5Because of that, almost everything you know about money andcredit you have learned the hard way.....by harsh experiences (that'sthe way I got most of my education, too). And, since those experienceshave usually been painful, is it any wonder you probably see moneyand credit as problems to be avoided. But, when you try to avoiddealing with money and credit concerns, you automatically create themoney problems you wanted to avoid.

In other words, you have never been taught how to manage yourmoney and credit. The only teachers you have had are the experiences(usually bad) you have had with money and credit. And, those teachershave only taught you to try to avoid the situation.

Do me a favor! Before you read any further, sit down and figureout where; and for what, you spent EVERY PENNY last month.

Can't do it? Neither can I.....but.....my accountant can (or, atleast, pretty close). Of course, all of my money goes through checkingaccounts (business & personal) so it can be properly handled foraccounting purposes.

If you really want to ABSOLUTELY "CONTROL" your finances,that is the BEST WAY to do it. But, to start your own debt consolidationprogram.....

YOU DO NOT NEED TO DO THAT KIND OF BOOKKEEPPING!Instead of trying to account for every penny you earn and every

penny you spend (like the books, booklets, and reports on "Budgeting"tell you), you only really need to account for the money necessary topay your monthly bills. What you do with the rest of your money is,then, up to you.

Of course, to do even that, you have to decide.....DO YOU WANTTO SOLVE YOUR MONEY PROBLEMS? OR DO YOU JUSTWANT TO STAY THE WAY YOU ARE?

Since I think I know how you answered those questions, let's getstarted setting-up your own.....

DEBT CONSOLIDATION PROGRAMWhat is THE BEST; CHEAPEST & MOST EFFECTIVE, vehicle you

can use to set-up your own Debt Consolidation Program?Would you believe.....A SIMPLE CHECKING ACCOUNT!I know.....I know.....I have read that about 30% of the adult,

working population Do Not have a checking account. So.....Before I get into USING A CHECKING ACCOUNT TO

CONSOLIDATE YOUR BILLS, let me make a few observations to helpyou.

CHECKING ACCOUNTS COST MONEY Yes, they do - but - if youdon't have a checking account, it actually costs you more. By the time

6you add-up the cost of Money Orders you purchase, and what youspend for check cashing services, you will find that you actually spendmore each month on those fees than the service charges, and cost ofchecks, on a checking account. Beyond that, "cash" can be lost orstolen and it's too easy to spend without considering what you arebuying.

CHECKING ACCOUNTS ARE NOT LOAN ACCOUNTS Unfortunately, too many people try to use their checking accounts asshort-term loan accounts. It usually starts harmlessly enough, whena person finds themself a little-bit short of funds on the day beforepayday. They usually rationalize, "Well, I'll just write a check today andget to the bank tomorrow with my paycheck, before the check getsthere to be paid." This wouldn't create any great problems.....but.....human nature being as it is, the next thing you know theyare writing checks two days before payday; then 3 days; then 4 days,until, eventually, their checks are getting to the bank before theirdeposits.

CASH IS YOUR ENEMY If you have money problems, you canprobably trace some of them back to your "cash" (not your cash flow). The problem is that "cash" just simply spends too easily. Let's sayyou have all of your money in cash. You know you have bills to pay,but you buy things you need or want with the cash you have today;because, "the bills aren't due until next week, and I'll have more cashbefore then." Then, when next week gets here, you don't have any cashleft, so the bills go unpaid. Almost the same thing can happen,however, with an uncontrolled checking account.

HOT CHECKS & OVERDRAFTS If you use a checking accountthe same way you would use cash, you will have the same problems.In other words, if you put all of your money in a checking account;then, you write checks for everything you buy, you will probably buythings you need or want today because you have the money in youraccount. Of course, later, when the bills come due, your account isshort; but, you write a check anyway But, even that isn't the onlycause of Hot Checks & Overdrafts.

MULTIPLE CHECKBOOKS can be dangerous. I know, I know;the husband and the wife both deposit their paychecks into theaccount so, logically, each of them should have a checkbook. Maybeso.....but.....if you have more than one person writing checks on thesame account, at the same time, you will inevitably end-up with morechecks being written than you have money in the account. (Hey.....I'ma millionaire, but, my wife and I only have one checkbook on ourpersonal account and we don't carry it around with us, either. It staysin the drawer; with the bills, where it belongs.)

7So.....to set-up your own Debt Consolidation Program, you MUSTopen a checking account for that purpose.

Even if you already have one checking account; open another onejust for your own Debt Consolidation Program.NOTE: By the way, this is the way I, personally, got control of my billsback in my younger days when I had severe money problems. I'mtelling you that because (to my knowlege) you won't find this methodwritten anywhere else. I created it for my own use.....and.....I know itworks, because it worked for me.

USING A CHECKING ACCOUNT TOCONSOLIDATE YOUR BILLS

In order to use your checking account to consolidate your bills, allyou have to do is use your checking account ONLY to pay your bills NOTHING ELSE!

Wait a minute.....Be Patient! Let me explain how you do it, first.

Since you have already figured-out how much you OWE PER DAY,you need to MULTIPLY that amount by the NUMBER OF WORK DAYSin your pay period (weekly = 5 days; bi-weekly = 10 days; monthly = 22days). Then, ADD 10% of the amount to cover bank charges & fees(that should give you a little cushion each month).

Each time you get paid, deposit your paycheck to your checkingaccount.....then.....withdraw everything above the amount you needto cover your bills & bank charges. You may either keep that amountin cash, to spend on anything besides your bills.....or.....you may wantto put it in another checking (or savings) account.....or.....you maywant to keep some in cash and put some in another checking account.

No matter how you want to handle the money, you will beabsolutely sure that you have enough to cover your bills in your"consolidation" checking account.NOTE: If you happen to OWE more than you EARN, per day, DON'TGIVE UP YET!! I'm going to get into Reducing Your Monthly Paymentsa little later on.....so.....Stay With Me!

By putting ONLY the money you need to pay your bills in ONECHECKING ACCOUNT, you will need ONLY ONE CHECKBOOK. Since you aren't going to be writing checks for anything except to payyour bills, you won't need a bunch of checkbooks, either.

And.....besides having just one checkbook.....you DO NOTCARRY THAT CHECKBOOK WITH YOU anywhere.

Keep that check book in a special drawer; or cigar box; or file folder. Then, as you receive your bills each month, put them in the drawer;box; or folder with your "consolidation" checkbook.

Although some people try to pay their bills daily; as they come-in.....it is much, much better to set a time and place to pay your bills. Since setting a regular routine is so important to the accomplishmentof any goal, I would recommend that you establish a time & place EACHWEEK when you will PAY YOUR BILLS.

Some people prefer Sunday afternoons. Others may like Saturdaymornings. Or, how about Friday evening; so you'll be able to enjoy theweekend knowing your bills are paid.

No matter what day, or time of the day, you choose, you also needto establish a place where you can do your bill paying. Someplacewhere you won't be distrubed or interrupted.

When it is BILL PAYING TIME; the time & place you have chosen,get our your "consolidation" checkbook and ALL of the bills you havereceived. Pay those bills that are due immediately. Then check thebalance in your account to see which other bills can be paid today. Pay those bills until the balance in your account is near the 10%amount you added to cover bank charges.

REMEMBER: Since you have reduced the amount you OWE to a dailyfigure, the amounts you deposit from each paycheck will equal thetotal of your bills by the end of any given month. Some weeks you willhave more bills than money. Other weeks, you will have more moneythan bills. But, over each monthly period, the money and bills willequal out. (Just don't spend the money in those weeks when you havemore money than bills.)

After you have finished paying what bills you can, put your"consolidation" checkbook and any unpaid bills back in their specialplace. Add any bills that come-in the next week.....then, follow thesame routine next week.

By following this routine faithfully, within a couple months, youwill have your bills stabilized.....as long as you don't go out and createany new bills to be paid.

Of course.....whether or not you begin using a checking accountto consolidate your bills, or not, you will have to decide.....YOU WANTTO SOLVE YOUR MONEY PROBLEMS.

And.....if you have learned that you OWE more than you EARNeach day; or, you just need more money to live-on from your pay-checks, you can use the same program.....but.....

REDUCE YOUR MONTHLY PAYMENTSReally, there is NO "Secret Trick" to Reducing Your Monthly

Payments.....but.....if you're going to do it, do it the right way.To Reduce Your Monthly Payments the right way the first thing

you need to do is to make two (2) lists of your monthly bills. On the8

9first list, you list all of the monthly bills that MUST be paid-in-full eachmonth. The other list will be a list of the bills that can be reduced.

But.....how do you tell the difference?For most people, the bills that MUST be paid will only be their

Rent/House Payment (so they won't find themselves out on the street);Car Payment (so they will have transportation); Utilities (so they willhave heat, cooling, light, etc.); and, maybe, Telephone (so they willhave contact with the world; if necessary). Others that MUST be paidwould be the "minimum" payments on Credit Cards, and ChildSupport/Alimony payments (so you don't go to jail). The rest of yourbills would, most likely, go on your list of bills that can be reduced.

Once you have your two lists, total both of them. The total on yourMUST PAY list is an absolute. You MUST put that much money intoyour "consolidation" checking account to cover those bills; no matterwhat.

Now.....divide the list of BILLS TO BE REDUCED into three (3)equal parts. Example: If the total of those bills is $900, you shoulddivide them so you have 3 lists of bills totalling about $300 each (onelist might be $296; another $312; and another $292). To help in ourillustration, label those three lists A, B, & C.

Next.....determine how much (better yet; how little) money youneed to reduce your payments by each month to live-on. Let'spretend; as an example, you want to reduce your payments by $200per month. Now, divide that amount by 2. (In our example, that wouldbe $100.)

Okay.....now subtract $100 from the amount of payments on listsA, B, & C. When doing that, take less from the smaller monthlypayments and more from the bigger payments, so the amount youreduce the payments by totals $100. As you subtract enough to makeyour $100 on each list, next to the monthly payment amount on eachbill, write:

PARTIAL PAYMENT $_________

Here's how it works.....The first month (I'll use January as an example), you pay the

PARTIAL PAYMENT AMOUNT on the bills on lists A & B; and the fullamount of payment on the bills on list C. In February (the 2ndmonth), you pay the PARTIAL PAYMENT AMOUNT on the bills on listsB & C; and the full amount of payment on the bills on list A. In March(the 3rd month), you pay the PARTIAL PAYMENT AMOUNT on the billson lists A & C; and the full amount of payment on the bills on list B. Then, do it again for the next 3 months; etc., etc., etc., etc. This way,each of your creditors get a FULL PAYMENT every third month; andpartial payments for the other 2 months.

When you send a "Partial Payment" to one of your creditors, justwrite on the check (where it says, "For:") the words, PARTIAL PAY-MENT. That way, the creditor will know that you know that it isn't afull payment.

I know.....I know......all of the crappola books, booklets andreports about paying short payments to your creditors tell you to senda long-winded letter telling the creditor why they are receiving a partialpayment. (Some of those books even have sample letters you can copyand use.) But, it is totally unnecessary. In the vast majority of cases,as long as your creditor receives some kind of payment, they won'tbother you too much. And, the ones that do, you may want to add toyour MUST PAY list.

Hey.....the lender/creditor only wants one thing.....TO GET PAID.As long as you are paying, they will be more lenient with you. It is onlywhen you quit paying that they really get nasty.

Just REMEMBER, Reducing Your Monthly Payments is a stop-gap measure ONLY. Its purpose is to just give you some breathingroom until you can straighten out our finances. And.....

Whether you are just going to set-up a Debt ConsolidationProgram to pay your bills in-full each month, or to Reduce YourMonthly Payments, too.....there is one.....

WARNING!Nothing you do is going to help you if you keep on

making more, and more bills to pay.So.....when you start on your Debt Consolidation Program, also

quit making any new bills. The best way to do that is to make it a hard,fast RULE that you don't "charge" anything; or create any new bills,unless you have waited at least 3 days before making the bill.....and.....ifyou are married, that both you and your spouse totally agree to makethe new bill. (If you aren't married or otherwise involved ask a dearfriend or loved-one to assist you by helping with your decision.)

I know all of this may sound like a "lot of work," but, the decisionis your's.....

DO YOU WANT TO SOLVE YOUR MONEY PROBLEMS?Wouldnt it be GREAT to wake up in the morning and KNOW that you were financially secure?

OR DO YOU JUST WANT TO STAY THE WAY YOU ARE?

If you stay the way you are, your money problems will only get bigger & Bigger &BIGGER.....until they crush you!

YOU CAN DO IT! Good Luck & God Bless

J.F. (Jim) Straw 204 Wildflower Way Dalton, GA 30720-8029eMail: jfstraw@BusinessLyceum.com