How to Stay Away From Debt

How to Stay Away From Debt


A life full of debts is the worst thing that can happen to anyone. We should learn to control ourselves and spend within our limits. People usually cannot stop themselves from buying those things of which they are fond of no matter how expensive these things are. They even do not hesitate to borrow money to purchase them.

Car, iPod, laptop, electronic gadgets, latest and stylish cell phones with advanced features and LCD are some of the examples. Some people are in the habit of changing gadgets frequently. If any new model of a particular gadget is available in the market, they start showing interest in buying that new model and discarding the old one no matter how good it is working. They are happy and satisfied to get the latest model but they do not think about the money which they have to return back.

If we succeed in controlling our spending habits and do not fall into temptation then we could save a lot of money and stay away from debts. Here are few ways which can help you to stay away from debts.

Track your expenditures

To track your expenditures, make a list of things you buy daily or weekly and calculate the total amount of money spent. Then sort out the things which were not necessary for you. You will be surprised to know that you could have saved more money than you actually did if you have not purchased those things which were not necessary to buy.

Then the money saved could have been used for some useful purpose. But still it is not too late, you can start making changes in your spending habits. People generally spend more when they visit some shopping mall or showrooms. They find it difficult to resist themselves on seeing wide varieties of home accessories and electronic gadgets. They are even ready to borrow money from their friends and relatives to buy those things which they cannot afford.

You may have found yourself doing the same thing. You should not forget that you have to return the money to your lenders on time. Otherwise it might be possible that they would hesitate to lend you money in future when you truly need it. Therefore, you have to be very careful while borrowing money from other people. If you check your spending habits regularly and cut out those things from your list which are not necessary for you then it will be easy for you to manage your money without incurring any debts.

Use your credit card judiciously

You should use your credit card only on necessary things or where cash is not accepted. If you keep on buying unnecessary things with your credit card then your debt balance will go on increasing. It is possible that you may not be in a position to clear your debt balance at the time of repayment.

In such a case, the credit card company will add your remaining balance to the balance of the next month and your amount of debt will further increase. So it is better if you keep your due amount as low as possible which you can pay back easily. You should also be careful while choosing credit cards. You should select that credit card which have low rate of interest and low or no annual fee.

Save a small portion of your salary on a regular basis

You should make a habit of setting aside a small portion of your salary for future use. You can deposit this money in your savings account. This way you will save decent amount of money which you can use for emergency purpose. Then, you will not have to depend on your friends, relatives or someone else for money.

Stop all your bad habits

Many people waste their hard earned money on gambling, alcohol, smoking, drugs etc. simply because they do not have enough strength to say no to these things. If you are also one of them then get rid of them immediately. People who are in the habit of gambling are not afraid of borrowing money to pursue their favorite past time.

These people incur huge debts as they borrow money not from one people but from many people. When they lose all the borrowed money then they find it difficult to pay it back. These bad habits are the main cause of broken marriages, relationships and fights. Therefore, you should try your level best to get rid of these bad habits with the love and support of your near and dear ones. These habits are going to give you nothing except sorrow.

Take a loan amount which you can afford easily

Sometimes certain circumstances arise which force you to take loan from a bank or loan company. In such cases, it would be better if you ask for that much amount which you can easily pay later on. If you ask for more than you can afford then you will have to incur huge debts.

It might be possible that you may have to arrange money from outside to pay your huge loan amount. You should clear all your debts before asking for another loan. Repaying back your loan on time will help you to improve your credit rating and the bank will also not be reluctant to offer you financial help when you are in need of it.

By taking into consideration the above suggestions, it would not be difficult for you to stay away from debts. You will never have to borrow money from someone else. You will be able to manage your money well and save it for future use. You will also learn to resist your unnecessary wants and desires. Always remember that you will never be able to sleep soundly if you have accumulated huge debts. So it is better to take control of your debt before it takes control of you. Learn to spend money on those things which are essential for you.

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