A quick guide to all things bad debt, including tips on how to get rid of bad debt.

1. BROWN & JOSEPH, LTD
ALL THINGS
BAD DEBT

2. BROWN & JOSEPH, LTD.
What is bad debt?
Baddebtisdebtthatdoesn't
increaseyournetworth,hasno
futurevalue,andthatyoudon't
havemoneytopayfor.
Examplesofbaddebtincludecredit
cards,autoloansandstorecredit
cards.

3. BROWN & JOSEPH, LTD.
How much bad debt is
too much?
Agoodmetrictouseisyourdebt-
to-incomeratio.
Tofindthis,addupyourmonthly
debtpaymentsanddividethatby
yourmonthlygrossincome.

4. BROWN & JOSEPH, LTD.
How much bad debt is
too much?
Agoodmetrictouseisyourdebt-
to-incomeratio.
Tofindthis,addupyourmonthly
debtpaymentsanddividethatby
yourmonthlygrossincome.

5. BROWN & JOSEPH, LTD.
How much bad debt is
too much?
creditcardpayment
+
autoloanpayment
---------------
monthlygrossincome

6. BROWN & JOSEPH, LTD.
How much bad debt is
too much?
Anythingovera43%debt-to-
incomeratioisaredflagto
potentiallenders.

7. BROWN & JOSEPH, LTD.
How do I get rid of bad
debt?
Gettingridofbaddebttakestime
andcommitment.
Herearesomestepsyoucantake
toreduceyourbaddebt:

8. BROWN & JOSEPH, LTD.
1. Prioritize
Your Bills
Payoffsecureddebtsfirst,like
autoloansandmortgages.
Thenpayoffunsecureddebts
likestudentloans,child
supportandtaxes.
Nextcomesunsecureddebts
thatarelikelytoappearon
yourcreditreport,andfinally,
unsecureddebtsthatareleast
likelytogointocollections.

9. BROWN & JOSEPH, LTD.
2. Create a
Budget
Creatingabudgetnotonlylets
youknowwhereyourmoney
isgoing,butitcanalsohelp
youcurbanyunnecessary
expenses.

10. BROWN & JOSEPH, LTD.
3. Make
More,
Spend Less
Seeifyoucanincreaseyour
incometocoveryourdeficit.
Considerputtinginmore
hoursatworkorgettinga
part-timejob.

11. BROWN & JOSEPH, LTD.
4. Don't
Ignore
Collection
Calls
Ignoringcollectioncalls
doesn'thelp.
Instead,acknowledgethedebt
andexplainwhyyoucan'tpay
it.
Yourcreditcardcompany
maybeabletohelpyouout
withtheinterestrateand
paymentduedates.

12. BROWN & JOSEPH, LTD.
5. Educate
Yourself
Thereareprogramsthatcan
helpyouifyoulookforthem,
likerepaymentplansorloan
modificationplans.

13. About Us
Brown&Josephoffersinnovative
solutionsforaccountsreceivable
management.
Visitourwebsiteat
www.brownandjoseph.comorcall
(800)444-8255.