Q: How can I assess how I'm doing financially?

A: Financial success, just like any other type of "success," is in the eye of the beholder. For some, nothing less than $500,000 a year in passive income is considered "success." For others, simply being able to pay all of their bills and live a life free from want is good enough. Your assessment needs to be a personal concern -- are you happy with how you're doing financially? If not, consider implementing some of the personal finance techniques advocated by Debt Relief USA to achieve greater financial satisfaction.

That said, there are a few yardsticks that can be effective in assessing one's financial well-being.

1. Are your monthly housing expenses (mortgage or rent, plus insurance and property taxes -- not utilities, etc.) less than 28% of your monthly income? If so, you're doing great. If not, you may be in trouble. Also, if your monthly housing expenses are much less than 28% of your income, you may want to think about getting a bigger house or apartment -- but that's up to you.

2. Do the monthly payments on all of your debts add up to less than 36% of your monthly income? Again, the lower your monthly debt payments compared to your income, the better, but 36% is typically seen as the cutoff point between doing well and doing not-so-well.

3. Are you saving enough for retirement? You should always max out the portion of your 401(k) that your employer is willing to match, and regardless of whether or not your employer even has a 401(k), you should save as much as you can in an Individual Retirement Account, as well. Currently, $4,000 a year is the maximum you can contribute, and anything much less than that is unlikely to pay for a comfortable retirement, particularly if you're already over thirty years old without much retirement savings.

Conversely, here are some signs that obviously indicate you're not doing so well:

1. You are maxed out on one or more credit cards and frequently have overage charges.

2. You have one or more charged-off debts that is continually recurring interest at 30% (or more) while you ignore it.

3. You resort to the use of payday loans and/or pawnbrokers in order to meet your financial obligations.

If any of the above are true, or if your monthly debt payments greatly exceed 36% of your income, then you may be a good candidate for credit counseling, a debt management plan, or even debt settlement services.

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