hen the cash was not immediately coming from her pocket. accounts are opened and the grace fac from now, by the time all the by then," Jamie Lee convinced herself Lee's new pocket. "The payments will not be due for at least 45 days periods are factored in. 1 am sure I will have enough to cover the Jamie furnishings have been delivered, and she is quite is now getting into a routine balancing the new quite happy with her choices. The bungalow is comfortable, and in Jamie Lee's mailbox; to The corresponding annual interest rates work and school obligations. Unfortunately, the bills have begun ie Lee factored in when she and the other two have interest rates of 19 percent per year. Those pityments are soon due for all the new furniture and appliances. on the credit card purchases were not something Jam , 18.5 percent on for the store credii cards. "Wow, 18.5 applied t fees can reaily add up quickly. percent on one, said ne an e other two have interest rates of 19 percent per year. Those he minimum payments, I could be paid off in 14 years! not sure my sppliances will still be workin nces will still be working at that time, nor will the furniture still be in style 14 years from now. Jamie Lee was starung to feel the consequences cf quickly Current Financial Situation oerspending and knew she must develop a plan to pay off the purchases Assets Checking account: S1,800 Savings account: s7.200 Emergency fund savings account: $2,700 IRA balance: $410 Car: $2,800 Income: Gross monthly salary from the bakery: $2.750 (Net income: $2,175) Monthly Expenses: Rent: $350 Utilities: $70 Food: $125 Gas/maintenance: $130 Liabilities: dent loan balance: $10,800 (Jamie is still a full-time stu- no payments are required on the loan until after Credit card payment: graduation) Credit card balance: $4,250 (total of three store credit cards) Questions 1. Jamie Lee received an offer to transfer the balance of all of her store credit cards to her bank credit card in the mail. It offered zero percent finance charges/interest for the first three months (90 days), and an 18.5 percent interest rate thereafter until the balance is paid in full. Upon reading the fine print, there was a $50 transaction fee and interest accrued from the day the balance transfer was made if the balance was not paid in full within the first 90 days. How could Jamie Lee use this balance transfer offer to her advantage? How is this offer a major disadvantage to Jamie Lee? 2. Based on Jamie Lee's current financial situation, could she possibly make the balance transfer option work? 3. What solution would you recommend for Jamie Lee to get her credit cards paid off as soon as possible? What are the advan- tages of your choices? What are the disadvantages of your choices? DAILY SPENDING DIARY