Tips For Staying Out Of Debt
Although there is no actual debtor’s prison, being buried under a mountain of bills can feel very constrictive. Once you are out of debt with the help of debt settlement and/or debt consolidation, there are several ways to prevent yourself from ever having to suffer from empty wallet syndrome again. Easier said than done, right? With a little discipline and a lot of persistence, you can happily maintain a lifestyle that will never be in need of debt relief again.
It’s all about a budget. Sit down and determine the total amount of take-home pay that comes into your household every month. Next, determine the nature and amount of all necessary expenses, including mortgage, auto, food and utilities. The amount that you have left after all necessary expenses have been paid will represent your extra spending money for the month. By spending no more than what you make, you will never again have to worry about needing debt relief.
Shop with a store list. It’s so easy to wander into the jewelry or sporting goods section, but there are often greater rewards with discipline. If you shop with a list and stay within the areas that sell only what you need to buy, you won’t be tempted by impulse purchases. Although excessive spending is not the only reason why many are in need of debt consolidation and/or debt settlement services, it is one of the leading causes of debt.
Keep a journal – or track your spending with a personal finance program on the computer. A financial journal is a very responsible step toward managing your money and avoiding debt problems in the future. How many times have you wondered where your money went? If you are like most, the answer to that question is all too often. Rather than wondering what happens to your hard-earned dollar, write down every single purchase in a daily journal. This will help you to see exactly what you are paying and where you could possibly afford to cut back if needed. For instance, if you are stopping by the local coffee shop for a sip of java, why not find a recipe online and make the same cup of coffee for a lot less money? Learning the simplest ways to save will soon turn into a new way of life.
Clip Coupons. You can save a lot of money every week simply by clipping a few coupons. Whether you find them online or in the Sunday newspaper, coupons are a terrific way to save money. Even if you only save $10.00 per week in coupons, that’s $40.00 per month. For most households, that money could be put toward internet service, telephone service or some other important and necessary expense.
Save it. Every month, try to put some amount of money into a savings account or savings bond. For as little as $25.00, you can purchase a $50.00 savings bond. If a savings account is more your style, many banks will allow you to open a savings account with no minimum deposit. Whatever you can afford, even if it’s just $20.00, putting money into some type of savings will provide you with a cushion for later use. Being able to access savings will be a great help if you should ever need to reach a debt settlement agreement with creditors.
Charge it. How can having a credit card help you to stay out of debt? It’s simple. By having only one credit card with a small credit limit, you will have access to some additional funds incase of an emergency or for making travel reservations, ordering gifts online or other necessary purchases. The key to having money is careful spending and, even with a credit card, this is possible.
Brian Dolezal
http://www.articlesbase.com/finance-articles/tips-for-staying-out-of-debt-96455.html
What are your best tips for living cheap and staying out of debt?
Danny,
Here is what I have done in the past, and it works (I had no choice at the time).
1. Make a budget. Include everything. I mean, include batteries for the remote, movie rentals, shaving cream and toilet paper. Don’t forget birthday present money for people you like. It’s got to come from somewhere. If you have it, include some money for entertainment – because you will end up using it anyway. Be 100% honest with yourself. You can’t hide from a lack of money. Now – after you are done, multiply this number by 1.2. Yes, add 20% more than you think. It’s for car repairs, blown tires, sinus infections, stuff breaking around the house, and so on.
2. Now, taking what you make or have available per month, look at it. Is it enough? If it’s less than your budget, you need to start looking at the details.
The big ticket items are how you live and how you get around. Between rent/payments, water, sewer, electricity, and trash, you could easily spend a thousand dollars a month, even if you house isn’t very big and isn’t very fancy. You can cut that in half with a roommate. You can cut it by 2/3 with two roommates.
Getting around: get or have a used pickup. Pickups are the sturdiest vehicles for the money that you can find. The less fancy they are, the fewer things are left to break. A ford F-150 or a chevy silverado will go until the body rusts away 40 years later. They are cheap to buy used, cheaper to fix, and cheap to buy parts for. Not only that, but you can make money with a pickup (hauling stuff for people, yard work, and so on). Only carry liability insurance. Drive safe and avoid tickets and wrecks.
Stay out of restaurants as often as possible, don’t go to movie theaters, and don’t buy anything you don’t need unless you can pay cash for it.
It’s really that simple. Don’t spend what you don’t have. It doesn’t even have to be miserable. If you know it’s not forever, if you are around people you enjoy, and if you have planned well so that it’s not a horrible stressful thing, you can get by on about 600 a month total. I know. I’ve done it. You can eat fairly well too but there’s enough on that topic to fill a whole other question.
-Kevin
References :
first, get on a cash basis. no cards, no loans, not even checks except when a bill has to be mailed. This reduces your dependence on banks… try to do without banks as much as possible. they are not worth their trouble. second, do not borrow! Get rid of monthly expenses that arent absolutely necessary such as extra cable or dish channels, telephone extras, if your car is paid off, drop the collision insurance and keep only liability and then drive safely and defensively. slowly you will realize your debt is steadily vanishing as you pay off accounts. and you will suddenly hit a point in time where the ends meet every month. after that point you’ll find you have more extra cash in your pocket every month. just keep grinding. it happens slowly at first, then BAM, you are flush. then be diligent so as not to repeat the original mistake.
References :
Start with the big expenses and keep tight control of them. So a low mortgage or rent and no or very low car payments maybe no car at all.
Then watch monthly commitments like cable tv and cell phone contracts.
Then you will be able to live on a smaller percentage of any income you have. Think twice before upgrading your life. Having children, buying cars, bigger apartments are nice to have but stretch the budget.
The easiest least painful way to reduce expenses is to never pay interest on consumer goods even cars. Not paying credit card interest can save you hundreds a month. Some cards charge 30% interest so if you owe 10,000 you would pay 3,000 a year for nothing but having stuff sooner.
Save an emergency fund even if it is only a thousand dollars to start. The means not wasting money on overdraft charges, payday loan stores or credit card interest because you don’t have emergency needs every time you get a flat tire or your car impounded for parking wrong.
Never drink and drive, lawyers and high insurance just isn’t worth it for the little fun you might have had.
Use birth control every single time until you decide to have children you can afford.
References :
The main thing is to avoid the social pressure from your friends and family members, even your work colleagues, to buy stuff and do things – aka keeping up with the Joneses.
I live in a small house, don’t drive a car (it’s cheaper to rent a car for those rare occasions when I can’t walk or take the bus where I need to go), have just a few outfits, and rarely eat out.
The only debt my husband and I have is about $40,000 left on our mortgage, and that should be gone in four years or less. But it wasn’t always that way. We had to change our spending.
References :
buy generic and store brands. you’ll be surprised how much you’ll save. keep your self in shape, its easier to stay healthy than to get healthy, and keep your vehicle well maintained. remember, its always easier to maintain a good habit than to break a bad habit. good luck in life 🙂
References :
general life experience
Tips for living cheap:
-Avoid late fees by paying bills on time and keeping up online
-Stop drinking soft drinks and avoid junk food
-Don’t smoke
-Invest at least 10% of your income
-Stop shopping for a whole month
-Buy only what you really need
-Bring your lunch to work
-Use mass transit
-Never co-sign a credit card with anybody unless you don’t mind paying the bill yourself
-Drink only water
-Cut cable TV
-Use your local library
-Don’t do drugs or drink
-Create a budget and see where you spend your money
-Turn off lights
-Don’t get a bunch of pets
-Carpool
-Buy used instead of buying new
References :
Read the book 1001 ways to cut your expenses by Jonathan Pond
You have to start thinking S-M-A-R-T. What kind of cutbacks can you make? For example: I drink bottled water. Paying $1 a bottle on something that covers over 65% of our planet is not smart. So I bought one of those water filters that screw into your faucet. I have bottles that I refil over and over again. This doesn’t take much time and you will reduce your carbon footprint as a bonus. Do you have a lot of small appliances around the house that are always on? Televisions, subwoofers, sterio equipment and microwaves use the most energy when they are left plugged into the outlet, even when they are turned off. Plug all your plugs from entertainment system into those 6 prong outlet plugs with the switch on them. When you are not using these items shut the switch off. I noticed a huge difference on my electric bill just by doing this. I also bought some of those florescent bulbs that look a lot like a regular bulb. These things use 80% less electricity than regular bulbs. Ave 60Watt incalescent bulb (old school) runs you 2 cents per hour. Ave 60Watt energy bulb averages 0.5 cents per hour. Wanna be creative? Find yourself leaving lights on? Buy a motion sensor switch, the lights will turn on when you enter the room and will turn off (by a set amount of time) when you leave the room. I have one, they cost $15 at HomeDepot. You would be surprised, but these small things add up. If you really need the money right away start cutting back on your food costs. Romain noodles cost a dime and they taste just as good as campbells chicken noodle that costs over $1 a can. Ok no chicken in romain noodles, but you are probably just missing about 4 tiny pieces of chicken. Adjust your toilet to use lesser water. If you don’t know how to do this then put a brick inside your toilet ‘chamber’. You will use a less water each time you flush, this adds up over time people. Before you know it you will be ahead. Need new windshield wipers for your car? Who says you have to buy 2? You only need the new one on the drivers side, leave the old wiper on the passenger side. Are you an impulsive buyer?? Listen here’s what you do……always save the receipt. Find a place to save all the boxes, packaging, etc. Try to get obsessed with folding all the packing materials, making them neat and tape the receipt onto the box/package. Make a game out of it. And get yourself into a new habit called "impulse returning" I once bought a shampoo rug cleaner to scrub my carpets. After I was done I didnt need it anymore so I returned it to the store. I like to think of it as free rental. So remember you have to start thinking S-M-A-R-T! Yours truly seahorsehawrey.
References :
Statistically speaking, here is your answer.
1. Spend less than you make. Very simple, but don’t use half of the population or the U.S. Government be your guide. Don’t buy on credit – if you use a credit card, pay off the full balance each month.
2. Finish high school. Studies show that the vast majority of poor people didn’t get that diploma. Get it and chances are very high that you’ll never be poor.
3. Get married before you have children. Once again, numbers prove this out. Single parents are MUCH more likely to be poor – especially single female parents.
This isn’t complicated, as years ago most everyone followed this recipe, and had much less financial troubles than we do today.
Good luck – I have faith in you – you had the thoughtfulness to ask a very intelligent question. Hope you go far!
References :
http://www.debtreliefdr.com
http://www.parentingselfhelp.com