Tips in Avoiding Debt

Thanks to the advent of technology, our everyday lives have become more entertaining, more informed, and more connected due to the computers, electronics, and devices we have.  However, the downside to this is that we have also become bombarded with advertisements, some of which we find wonderful and irresistible to buy, plainly because we see these stuffs as necessary in our lives.  The problem that many people face is that to acquire such, they often make use of their credit cards because they cannot easily shell in the cash to pay for it.  If they are unable to pay their whole expenses at the time of their credit card’s due date, they become in debt.

To avoid being in deep debt, particularly with your credit card, we have listed a few tricks that you may find useful.

credit card debt1. Stop using your credit card – by this we do not mean that you will close them.  A credit card can be very useful for emergencies as well as on well-planned large purchases like big TVs, home appliances, or a car as it allows you to pay for the items in increments as opposed to paying them in full.  However, when you impulse buy, particularly on personal items or gadgets that are beyond your monthly financial means, then you are just given credit card companies a favor by putting yourself in debt.  Use cash whenever possible.  If you cannot afford something you want with your cash at hand, just think of it as being beyond your financial capability.

2. Compute your usual weekly spending – once you are able to compute your usual weekly spending, you will be able to budget how much you need to take from your paycheck for a month’s worth of spending.  Divide the amount you get into daily portions.  When going to work, bring only the allowance you have for each day and leave your credit card at home.  This will help to prevent you from making any unnecessary purchases whether in cash or by credit.  If you really want to buy an item, you can simply go back the next day to make the purchase.  This is actually enough time for you desire over the item to cool off and provide you with a better judgment on whether you really need to make that purchase or not.

3. Say no to shopping therapy or rewarding yourself for hard work – while this tip may come as a shock to shopaholics or people who like to reward themselves every week or every month for working hard, this is actually one of the reasons why a lot of young professional go badly in debt.  Shopping or rewarding yourself is not a way to relieve stress, but it is more like trying to distract yourself.  Just because you worked hard for a few months does not mean you can buy the smartphone that you fancy even though it is beyond your means, or just because you are stressed out does not mean you can go on buying the designer clothes and apparels you like even though it will take several paychecks to pay for them.  This is why it is sometimes best to leave your credit card at home because you are able to avoid any temptations of buying stuff you do not really need.  There are cheaper ways on how to distract yourself.  You can try going to the gym or try doing some sports, yoga, or martial arts.  These doesn’t just help to distract you, but they also help to keep you fit.  What is important is that you do not make any unnecessary spending that is not within your budget or paycheck.

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