Staying out of debt is something that people struggle to do. Just about anybody can get a loan these days, for just about anything. Not only that, loans come with huge interest rates which can be impossible to pay back. All it takes is one bad decision and you could be in debt for years to come. This guide will help you stay out of the red for good!
Only Use a Credit Card on Large Purchases
People reach for their credit card whenever they want to buy something these days. However, you should only be using a credit card on large purchases. This is because a credit card offers extra protection if something goes wrong. If you’re finding it difficult to stop using your credit card, you probably shouldn’t have one at all. Be brave and cut yours up or do something weird and freeze them. Then you’ll have to wait for them to thaw before you can buy something!
Don’t Spend Money You Haven’t Got
Lots of people spend money they haven’t got. They go into their overdraft, loan money from friends, and take out pay day loans to name just a few things. The key is to avoid spending money you haven’t got. You might have every intention of giving the money back, but you never know what might happen. What situation would you be in if you lost your job? Think about it!
Work Out a Budget
Take into account the money you earn monthly and work out where you should be spending what. Take into account everything you pay out for bills, and all of your other essentials. Make sure you know how much you have each week to spend on yourself, and don’t spend more than you can afford. You could even make it so that you save a certain amount of money each week, rather than spending your entire pay packet.
Keep Track of Your Finances
Keep track of where your money is going if you just can’t seem to stick to your budget or make ends meet. There are apps that can do this for you, or you can just make a note every time you buy something. This way, you’ll have an idea of where you’re spending the most money and where you can cut back. Make sure you note down even the smallest of payments; they all add up!
Save for a Rainy Day (But Pay off Debts First)
Saving for a rainy day will protect you from any nasty surprises. You may have medical bills to pay for example, or your pet may need emergency treatment. However, you should pay off any existing debts before you start to save money. The longer you’re in debt, the more interest you’ll need to pay. If you have a cash settlement being paid to you each year or month but would rather have a lump sum to get you out of debt, this webpage offers cash upfront.
If you follow this advice, you should always find yourself in the black and never in the red. Do you have any tips to help our readers further? Leave a comment!