Many Americans find themselves weighed down by the financial burden of debt. Watching your paycheck be extinguished week after week once you pay your bills can be extremely stressful and unsatisfying. The stress that is associated with debt can lead to depression, illness, and divorce among married couples. Debt is easy to accrue, especially with our desire to have new toys or the latest and greatest that technology has to offer. The fact is that many of us live outside of our financial means. Sometimes, debt is brought on as a result of unfortunate circumstances like unexpected hospital bills or the loss of a job. At Law Office of April Perry Randle, PLLC, we do offer an alternative with the option of filing for bankruptcy. In some cases, you can prevent yourself from falling knee deep in debt, and so we wish to share some words of wisdom with you on how you can steer clear of debt.
Create A Budget
Find out what absolutely needs to be paid: mortgage, rent, utilities, gas, car payment, groceries, etc. Once you create a budget it is important that you stick to it. Use cash, check, or a debit card in paying for your bills. Robbing from Peter to pay Paul rarely works out well; stay within your means. It’s ok to plan for recreational activities, but if you are continually charging your social life to a credit card, then you’re only making the situation worse.
Eat Out Less
While many fast food restaurants offer cheap meal options, it is still a better idea to eat at home or bring your lunch with you to work. Grabbing a quick bite can be costly if done day after day. If you eat out 3-5 times a week (and we’re just accounting for fast food) then that’s anywhere between $15-$30 dollars you could be saving each week. That’s $780-$1,560 per year spent on just fast food, and those are just estimates for one person, not including nicer restaurants. Is your jaw dropped? We thought so.
Be Smart With Credit Cards
You don’t need a wallet full of credit cards. Find one or two that works for your situation. It can be wise to use a credit card for something you’ve budgeted for like gas and groceries. You can then immediately take your budgeted money to pay off the exact amount you just charged to your credit card, and then you can get the benefits of using your credit card like cash rewards. However, just because you get 3% back on shopping doesn’t mean you should buy lots of clothes and things you don’t need. That’s how they get you. Use your credit cards to your advantage; don’t let them worsen your situation.
Plan to Save, Not Spend
With large purchases, most retailers will offer financing plans with an appealing monthly payment. If you want to buy a new TV, wait before signing the new in-store financing. Plan ahead and save the money to buy the TV outright in one transaction. That way you do not risk interest charges and piling on one more payment to the others you already have. Plus, you learn how to put money away and save…it just might become contagious.
Buy Out of Season
Many are obsessed with having the latest products for the season. If you’re a golfer, then wait a year to buy the newest TaylorMade driver. By then, there will be a newer model with the high markup, and last year’s model will still be new and considerably cheaper. The same goes for clothing and other recreational materials. The latest model is not always the greatest. Look for clearance items; many times the clearance price just means that it is out of season or it has been replaced by the latest model. The item itself is still new and perfectly usable.
There are many other ways you can avoid debt and save money to pay off the debts you already have. Learn to pay yourself every paycheck to build a respectable savings account. Just 10% of your check can add up quite quickly. If you need extra money, consider taking on a part time job. Even something that is just once a week can help with a car payment, utility bill, or for savings.