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We all know that if something is worth remembering, it is certainly worth writing down. Your plan for living debt-free is one of the most important life plans you’ll ever make.

As the old saying goes, there is no time like the present to begin putting your plan together. If you are still living at home, and haven’t given much thought to moving out of the family nest, you owe it to yourself to start doing some crucial research now.

There are a few questions you need to address before you can even think of moving out. First of all, do you have a full- or part-time job? Without a job, you cannot walk out the front door of your parents’ house, let alone rent your own apartment and pay your bills. So that is your first step. If you have graduated high school, and are planning to attend trade school or college, you still have the summer to begin earning some money. There’s no reason you can’t begin contributing to the household expenses, and you also get some practical experience in money management and bill paying in the process. By helping Mom and Dad out with the basic expenses of housing, utilities, food and clothing now, you are helping yourself to become accustomed to the monthly routine of paying your own bills later.

Assuming you have a full-time job now, what is your monthly net income? If you don’t know the difference between net and gross income, net income is what is left over after all the taxes have been taken out of your paycheck. This is what you have available to pay your monthly expenses. You know, those annoying little things called bills.

It is amazing that many young people who graduate high school, sometimes even college, are poorly prepared to begin life on their own. Some have no idea what apartments in their local area are renting for, and have never seen a billing statement. Why should they? Their parents have been paying all the expenses up to now. Are you one of the ill-prepared ones? If so, don’t despair, because it’s never too late to begin learning. And it’s not really as hard as you think.

Doing the math isn’t exactly fun, but it is much better than living with a huge debt load down the road because you didn’t bother to do your homework first. But cheer up, it’s also easier than your geometry or biology courses. All it involves is simple addition and subtraction, and you can even use a calculator if you want. For this exercise, we will suppose that you have just accepted a job which will pay you a net income of $750 twice a month. This brings your monthly net income to a total of $1,500. Looks like a lot of money, right? Well, don’t start celebrating yet. You have to pay off your monthly expenses first. Don’t worry; remember this is just a hypothetical exercise for now.

Your regular monthly expenses are the six basics of life; housing, utilities, telephone, food, clothing and transportation. Let us assume that your monthly rent is $700, your average electricity bill is $60, and your average phone bill is $40. Got your calculator handy? Add up these three costs for a total of $800. Now you have to subtract the $800 from your monthly income of $1,500, which will leave you with $700 for the rest of the month. No problem, right? Maybe, and maybe not. You haven’t figured in the costs for food, clothing and transportation yet. Since transportation is crucial to getting you to and from work every day, let’s tackle that one next.