These days millions of people have some kind of debt hanging over their heads, and it’s important that you know how to remain financially free. Getting into debt is far too easy, which is why you will need to learn as much as possible about how to stay out of it entirely. If you want to stay out of debt entirely, you will need to keep the following things in mind always.
1. Give yourself Permission to Spend (but not too much)
If you have done a good job of reigning your spending in over the years, you should give yourself permission to spend and splurge once in a while, but within reason. It’s important that you do not go overboard with your spending, because doing so can easily turn into a habit that’s difficult to break. There is nothing wrong with loosening up your budget a little bit, but you’ll always want to be reasonable about it.
2. Pay for things with Cash as much as Possible
When it comes to buying things like clothes, electronics and just about everything else, it’s a good idea to spend with cash if you can. It’s absolutely not a good idea to get into the habit of putting things on a credit card, because doing so could easily get you into trouble later on. Most people with crushing credit card debt didn’t think that using their plastic to buy things was an issue at some point. By spending with cash you will be able to minimize the risk of credit card debt.
3. Always Plan your Spending
It’s crucial that you always plan out what you are going to spend your money on and how much you’re going to spend. When you take the time to plan this out, you will have a much easier time staying out of debt. By planning your spending out you will be able to avoid splurging and spending money that you cannot really afford to spend. If you have your eye on a new flat screen TV or something really big like a Caribbean cruise, plan it out and save up the money. While you might not get the instant gratification that you would from charging the item on your card, doing so will help you stay out of debt rather effectively.
4. Identify your Spending Triggers
The next thing that you will need to do in order to stay out of debt is to identify the things that you cannot seem to help but spend your money on. Whether it’s clothes, electronics or something else, make sure that you avoid these things in stores when you don’t have the money. It’s simply too easy to give into your impulses when you are window shopping, so you will definitely need to keep this in mind for the future. The less you tempt yourself, the better your chances are going to be of staying out of debt.
5. Save Your Extra Money
When you have paid of all of yours debts, take the money that you have left over and put it into your savings account. The more money you manage to save, the less you will have to worry about big expenses coming up. The fact is that financial emergencies happen to everyone eventually, so you will need to make sure that you have the money to cover them. Every penny you put into your savings will go towards providing you with financial insurance and peace of mind.
6. Develop a Support Group of Frugal Friends
It’s always easier to stay on track financially when you have a support system around you. Make a point of surrounding yourself with people who are likely you when it comes to matters of finance. It’s very easy to get into debt when all of the people around you are spending like crazy.
7. Always Remember how terrible being in Debt Feels
If you are looking for a very effective way to stay out of debt, always remember how terrible it feels to be in this type of situation. A lot of people forget how horrible being in debt is once they have gotten out, but you will need to remember that feeling every time you are tempted to splurge on something you don’t really need.