James has prepared his income statement: Income Salary 3,500 Tax withholding (490) 401(k) 0 Health insurance (210) Net salary 2,800 Total net income $2,800.00 Expenses Rent (900) Utilities (325) Internet (62) Credit card payments (200) Food (625) Clothes (200) Transportation (200) Entertainment (400) Total expenses $2,912.00 Difference ($112.00) How can James free up more money to pay down his credit card debt? (1 point) Responses He has to start contributing to his 401(k). He has to start contributing to his 401(k). He has to pay less in rent each month. He has to pay less in rent each month. He has to cut back on other expenses. He has to cut back on other expenses. He has to complete an income statements every month. He has to complete an income statements every month. Skip to navigation
1 answer
To free up more money to pay down his credit card debt, James should:
He has to cut back on other expenses.
By reviewing and adjusting discretionary spending categories such as entertainment, food, clothes, and utilities, he can find ways to reduce his total expenses and create more room in his budget to pay off his debt. This option directly addresses his current financial situation, helping him to balance his budget while still managing essentials.
