Business & Financial

Uncertain of where to begin? Not sure the difference between a debt and a credit? We’ve got you covered on the basics of basics when it comes to bookkeeping, and understanding your debits and credits.

First, throw out the traditional definition of debits and credits. No, a debit isn’t a deduction, and a credit is not an increase. They’re the names of the columns on your bookkeeping ledger (99% of the time, debit is on the left, with credit to the right).

In bookkeeping, or double entry accounting specifically, the total of each column must equal the other. Basically, the total of all of the debits has to equal the total of the credits – ensuring this equality; you can eliminate any basic arithmetic error. When making an entry, a bookkeeper makes an entry into the credit side of the ledger as well as on the debit side. Everything is in the positives (No negative numbers here).

LONDON — Government debt is growing, as is the deficit. The economy is struggling to get out of recession and there is talk of spending cuts or higher taxes. The unions are on edge. And the currency is plummeting.

The country is not Greece — but Britain, almost six times bigger, racking up debt even faster, and headed into a critical election.

The woes of Britain — only recently a cocky symbol of the global boom times — show that the troubles for Europe, and the West, extend far beyond the traditionally laggard countries of southern Europe.

Britain does have some factors in its favor: Unlike Greece and its reliance on the common euro, it prints the currency in which its liabilities are denominated. It is also considered a surer bet for repayment, maintaining a triple-A credit rating.

How many people do you know who pay cash for everything? I would bet zero. Well, since you know me now, you can say one! You’ll hear about some financial gurus who talk about paying cash for everything with some crazy system, but it always involves using credit for a car or a house. They say you shouldn’t use credit cards, but you should have them for emergencies. What does that even mean? How is that living on cash alone? The problem with their so called plans is they don’t tell you how to make enough cash to actually live the cash lifestyle.

Think about it. If you make $35,000 a year, how will you ever pay cash for everything? You can’t! Cars cost $25,000. A house costs $200,000. A nice flat screen television costs $6,000. So by telling you to live on cash alone, they’re basically saying, “Don’t buy anything!” What do you do with that? Live in a crappy apartment and drive a broken down used car? That’s no way to live. What you need is a way to bring in serious cash, so you can actually life a cash lifestyle.