How to Stay Out of Debt
Getting in to debt is very easy to do these days. Although banks have tightened up a bit, it is still very easy to borrow money either by way of a credit or store card, overdraft or loan and it can be very easy to get in to trouble once you have debts. They can mount up very quickly, borrowing money to pay interest on a loan can lead you in to all sorts of trouble. The best way to avoid this is to stay out of debt in the first place.
It sounds very simple in theory – it is best just to not buy anything unless you have the money to actually pay for it. This is fine normally when it comes to buying things like groceries, most of the time at least, but when it come to bigger purchases like white goods, cars and even houses then it is not so easy to save up the money.
Most people do borrow money to buy a house, they would never be able to afford one otherwise, but there are alternatives. You could always rent a house and then you will not have to borrow and bearing in mind that most people tend to pay three times the amount they bought their houses for, because of the interest then it can be good not to borrow.
But as well as renting, what else can you do to avoid getting in debt? The main thing is to live within your means. That is only spend money that you have and nothing more. It can be difficult, but if you try to save some money each month then you might be able to use some of that money to buy things if you have not earned enough that month.
The best way to get in to the habit of saving I to take some money each month and put it in to a separate account. Do this on the day your salary arrives in your account and then you will not be tempted to spend it elsewhere. If the money is not in your account then you cannot touch it.
But what if you need to buy something, such as a new fridge and you have not saved enough money? You may feel that there is no solution but getting in to debt. However, it is worth asking around first as you may find that people have spare items they can lend you, you may be able to pick up something cheaper second hand or it might even be possible to wait a while until you have saved up and then buy one.
There is often a solution if you look hard enough and it is just a case of spending some time thinking before rushing in to buying things. As you get used to living debt free you are likely to become better at spending wisely and saving money as well as being more resourceful when it comes to getting new things, finding bargains and saving money.
