Saturday, December 8, 2012

Will Personal Debt Push Consumers Over the Fiscal Cliff?

7 Tips to Surviving Financial Uncertainty

Phoenix, AZ, December 08, 2012 - Consumers continue to face a lot of financial uncertainty. While the balance of power in Washington looks similar to how it appeared before the election, the big battle over the country’s growing debt load—$16 trillion and continuing to swell—is still raging.

How will the government avoid the so-called “fiscal cliff”—the $600 billion of tax increases and spending cuts that are scheduled to take effect in 2013? And what does it all mean for consumers, especially those carrying heavy debt loads?

“Your best protection against the impending fiscal cliff is to begin eliminating debt now,” says financial literacy expert and founder of, Anthony Manganiello.

Since the looming fiscal cliff is expected to hit 90 percent of households by tacking on an average additional $3,500 in annual taxes, in addition to working now on becoming completely debt-free, Manganiello also offers the following advice on how families can avoid being pushed over the edge:

1. Know where you sit financially with your personal cash flow, NOT to be confused with a budget. Determine what smaller balances on debt you can pay off NOW, so you can free up monthly payments tied to those balances. You may need that cash flow in the not too distant future.

2. Focus on complete debt elimination. Concentrate all available funds towards eliminating as much debt—as quickly as possible—so your cash flow is in as good a shape as possible should the White House and Congress fail to take action.

3. Learn from the past. Look at your monthly cash flow and ask yourself, “What did I buy that resulted in all of these payments?" If you can't answer that question with any degree of detail—meaning you've spent money on purchases you really didn't need—let that reality sink in and avoid making the same mistakes in the future.

4. Realize that you’re a wealth generator, but not necessarily a wealth accumulator. Think about the past five or 10 years: How much income did you bring home and what do you have to show for it? Then, project what you will likely earn over the next five to 10 years and focus on accumulating as much of that wealth as possible.

5. Add up all your debt payments (mortgage, cars, credit cards, all of it) and ask yourself: If I was completely debt-free and didn’t have to make these payments, how much better off would me and my family be?” Let that be your motivator.

6. Determine how much of your gross annual salary is earmarked for debt payments. Depending on your income tax bracket, ascertain how much of gross income you have to generate in order to bring home enough to make your annual debt payments. Many households have more than 50 percent of their gross annual income earmarked towards servicing debt.

7. Even if the fiscal cliff is avoided, what have you learned? While the administration may be able to curtail the fiscal cliff, and avoid going over the edge, what should this mean to you? If the impending cliff had you in panic mode, then you need to reconsider your plan.

It’s possible that—fiscal cliff or not—your greatest vulnerability is your personal debt load. If that’s the case, then you need to do everything you can to change that reality into achieving a financial position that has you as well prepared as possible in the event economic calamity strikes.

Anthony Manganiello is an author, speaker, and entrepreneur who has spent the last two decades in the research and development—including the investment of millions of dollars, and tens of thousands of interviews with consumers looking for help with their debt and credit problems. The end result was the creation of the Cash-Flow Analysis™, the Cash-Flow Dashboard™ the book, The Debt-FREE Millionaire: Winning Strategies to Creating Great Credit and Retiring Rich, and now the

Anthony Manganiello
Debt Free Academy
450 Phoenix, AZ 80516

New Research into Impact investing endorsed by AAA

AAA has welcomed news that pension funds in the UK are increasing their exposure to impact investments.

Boston, MA, December 08, 2012 - Alternative Asset Analysis (AAA) has welcomed news that pension funds in the UK are increasing their exposure to impact investments.

Research carried out by social investment intermediary Social Finance, found that 48 per cent of the 47 pension funds it surveyed were planning to invest in socially and environmentally sound asset classes, such as microfinance, green energy and social housing over the coming 1 to 2 years.

At the moment, only 23 per cent of the pension funds, with assets under management totalling some $230 billion, hold such investments. AAA’s analysis partner, Anthony Johnson spoke on behalf of the alternative investment advocacy group: “We welcome the news that pension funds in the UK are starting to realise the benefits of social investment.”

“Here in the US, institutional investors and individuals alike are all starting to increase their exposure to both alternative investments and impact investments and we wholeheartedly welcome this transition to a more responsible approach to investments.”

AAA also claims that alternative, ethical investments are a great way to diversify an investment portfolio against risk.

Social Finance’s David Hutchison, stated, “Impact investment is a visible asset with clear cash flow, stability and low correlation to other asset classes.”

AAA said it agreed with this, adding that other alternatives, such as forestry and timberland investment through firms like Greenwood Management, which operated sustainable plantation projects in countries like Brazil and Canada – also carry very low correlation with other economic trends. Mr Johnson said, “This means when other asset classes are losing value due to wider economic factors, these alternatives are staying strong.”

Mr Hutchison added that the next step in encouraging impact investing is setting up diversified, larger funds, to ensure people can get involved without putting up hundreds of thousands of dollars in initial investment. This will allow more individuals to get involved with this ethical side of investment.

Anthony Johnson
Alternative Asset Analysis
71 Commercial St
Boston, MA 02109-1320