Introduction to Business
September 25, 2014
Damien Duff Case Study
Assess Damien's current financial situation.
Damien's current financial situation is very interesting. He had thought that his life would unfold more or less like the way that he had planned. The plan that he developed was a good and well thought out one, but things just went a different way than he anticipated. After meeting his future wife in Australia, he had a honeymoon in South East Asia, and a move back to Canada that accelerated his debt more than he anticipated. Additionally he has an unexpected pregnancy that he has to deal with now. Their current financial situation includes their assets being less than their liabilities by $13,100. Also, their annual expenses are $144 more than their salary. This means that their debts will accelerate more than they expected.
2a) List the various debt instruments that Damien owns and list the pros and cons of each.
Pros- Affordable payments over long period of time.
Cons- Potential foreclosure if you fail to make payments.
Pros- Access to multiple vehicles whenever needed.
Cons- The two car loans that Damien and his wife have could add up and cause trouble.
Pros- Often times they are necessary for a good advanced education.
Cons- Can hinder the start of your adulthood by leaving you immediate debt to deal with.
Pros- Very simple way to make payments.
Cons- Easy to fall too far behind and harm yourself financially, or too use the card use the card too much.
Line of Credit-
Pros- Gives you short term money that you can pay back later.
Cons- Along with the interest rate adds to the debt.
2b) Which type of debt should he focus on paying...