As you glance across the room at a pile of bills sitting on your dining room table, you ask yourself, “How did this happen?” Debt is something that creeps up on you and then suddenly becomes a burden, consuming your hard-earned money. Fortunately, it is possible to live life debt-free.
Bringing Creditors to Current Status
When you have a lot of debt from multiple sources, it becomes harder to make your monthly payments on time. Unfortunately, it only takes a few late payments and a single missed payment to turn a good credit score bad. This is why it’s important to do everything you can to pay bills prior to the due date. If you need financial assistance bringing your bills current, there are loan places in Albuquerque that can help.
Weigh the Pros and Cons
Before purchasing a large ticket item, make sure to weigh the pros and cons. Many people fall into debt for short-term pleasures. They buy things such as a huge flat-screen television to host Sunday football parties and the newest gaming system. While enjoyable, they are not essential and in a year or two, replaceable.
Living on Cash
In the big picture, debit and credit cards have a relatively short history. Prior to their existence, people lived on cash. They allocated a certain amount of money to keep weekly on their person and the rest went into the bank. If you want to remove money, you needed to go to the bank personally and make a withdrawal. If you didn’t take out enough money for the weekend, you worked with what you had. Adopting that same method today will prevent you from draining your bank account on frivolous purchases. Figure out what you need for the entire week and then refrain from touching the bank account.
Reserve Credit Cards for a Particular Use
In many ways, having a credit card or two is a good thing. It helps improve your credit score and allows you to book a vacation, rent a car, and many provide benefits for their use. The problem comes with misuse. Some people view a credit card as a means to purchase items they otherwise could not. Unfortunately, this will only lead to a lifetime of digging out from under. Find one that rewards use and then use it to get something in return. If you travel often, open a credit card that rewards you with free airline miles. If you shop at a variety of stores, use one that pays cashback for purchases.
Save for the Things You Want
Saving up the money you need to buy something you want will help you manage your money better. It teaches you how to save and how long it takes to acquire it without using credit. Using this method going forward, will prevent the building of excessive debt and allow you to remove excessive debt.
Doubling Up on Payments
Without a bunch of credit cards featuring high balances, you free up money that you can use to pay off your necessary debt faster. For example, on your mortgage, making the payment and then writing a second check that you identify to go towards the balance will allow you to pay off the mortgage years prior to your initial commitment.
You can live debt-free and experience a better quality of life.