Debt Relief:Proposal

Introduction

Living in a capitalistic society can bring us both joy and grief. Having the choice between a $10 sweater or a $100 one is a right that is precious to many us. We have been socialized to think that more is better, regardless of whatever more is. Our society is built around selling and buying stuff. On a daily basis, everywhere we look, we are bombarded with messages of what to like, what to wear, where to live, who is attractive, and what product is better for us- and frankly, we tend to buy into these messages-just look around you. We, Americans, like it our way, the living over our financial capability way. With the price of virtually everything rising and wages staggering (to even dropping), it is getting harder and harder to avoid debt. From such a diverse society that we are, we all have one thing in common- we all live in DEBT. This concept, unfortunately, may seem as an inevitable phenomenon, but understanding it and controlling it can be a beneficial tool to have. This report will address the issues of debt from many different angles. From the reasons of going into debt to the options of getting out of debt. In the end, we want this report to be informative as well as applicable to the thousands of people searching for an understanding of the dynamics of debt and how to, eventually, get out of debt.

Background

Americans give little consideration to the consequences of overspending. Being in debt is serious and there is help for those who need it. Loans are justifiable in many instances, but the funds to repay those loans must be available. Joe Smith, for example, has fallen into the debt trap. Although Joe is already obligated to repay $60,000.00 in student loans, he had daily living expenses and owes approximately $13,000.00in unsecured debt. Joe completed his education and is employed, but now finds that he cannot fulfill his obligation to repay the money he has borrowed on his $40,000.00 annual income. Joe is employed and he has to pay his bills or his creditors may refer his accounts to a [collection agency]. Collection agencies sue and garnish paychecks to get the money owed. Although Joe is way over his head in debt, he wants more. He wants a new (expensive) car and a house. Joe realizes that his paychecks can only stretch so far and that he needs help to manage his debt. Getting out of debt requires an understanding of debt, as well as, simple applications that can help in the process.

Proposal

This proposal is intended to help those who are contemplating getting into debt, those who are in debt, those who want to manage debt, those who want to get debt relief and those who want to avoid getting back into debt. We will offer extensive research into debt relief agencies, we will offer advice on places to get financial planning assistance, and finally, we will discuss alternatives to debt. In addition, the consequences for doing, or not doing, something about a financial crises can have on your credit report will be addressed. In the end, we hope to inform the reader about the dynamics of debt, which may allow them the opportunity to make an educated choice about what course of action to take.

Tentative Schedule

Week 1: Oct. 26 & 28 Research: Reasons for getting into debt Distinguish between “good” debt and “bad” debt Statistical information about debt; the average American debt, the correlation between age and debt, the average number of years it takes to “get out” of debt., and any inferences about the direction the country, as a whole, is heading when it comes to debt

Week 2: Nov. 2 & 4 Research: Debt relief agencies The pros and cons Consequences of getting involved with such an agency Distinguish between a credible agency and a bogus one Thing to consider when contemplating going to a debt relief program

Week 3: Nov. 9 & 11 Research: Financial planning Budgeting Places that offer these services- private and public Credit ratings: what do they mean

Week 4: Nov. 16 & 18 Research: Alternatives to debt Managing debt Being “debt-free” as an option Staying debt-free

Week 5: Nov. 23 (the 25th is a holiday) Research: Options to becoming “debt free” Bankruptcy Improving your credit rate

Week 6: Nov. 30 & Dec. 2 Revise and make corrections as needed.

Week 7: Dec. 7 & 9 Turn in project.

Teams and Responsibilities

There will be a total of three teams (A,B, and C). The three teams will have a specific task each week, but will rotate the weekly task between researcher, typist, and editor. This way, each team will have the opportunity to conduct each aspect of the project. Each team will have a “Team Leader”, which will be elected by the team members. There may be a different Team Leader each week if the team so desires.

The task: The researchers will look up each particular week’s topics which are outlined in the tentative schedule. The typers will consist on extracting relevant information done by the researchers and typing it down to be turned in to the “editors”. The editors will then organize the information and revising it for any possible errors; whether it be grammatical or informational. In addition, the editors will be responsible for turning in a hard copy of the work to the coordinators. The Team Leader will be responsible for the team’s progress. The coordinators will facilitate the process by offering advice, helping with any task, and being the liaison between the teams and the professor.

Request For Authorization

Being in debt should never be taken lightly. Whether it be a small department store credit card to an outstanding home loan; essentially, both are the same- the balances need to be paid-off in order for those things to be yours. As prices rise, interest rise, and salaries stagger, it has never been so crucial to understanding what debt really means. In the mist of the depth of these statistics, however, there is hope. This report will be an informational tool as well as an applicable one. Being able to differentiate between a “good” debt and a “bad” debt can be the difference between buying the home of your dreams or renting an apartment. Should bankruptcy even be an option? Is there such a thing as being “debt-free” now a days? What is the best budgeting strategy for me? These and endless other questions can be answered in our report. This is why we are asking for authorization for our project. So that in the darkness of debt collector’s dinner time calls, there may be someone who may benefit from the information.