5 Keys To Living A Debt Free Life
Debt can be one of the real killers of both your personal and professional goals in life. A large amount of debt can cause you to have to direct large portions of your income to servicing the debt which leaves little to pursue interests and activities of your own and allow you the ability to date and start a family of your own. Further, it can limit your career choices and force you to have a better paying job as opposed to one that you truly enjoy and identify with. If you have debt, it is a good idea to get rid of it as soon as possible. It is hard to be so with the large amounts of school loans and other debt that many people get until they get established in their careers. This article will discuss five ways yo help you to be debt free by the time you are 30 years old and fulfill your dreams of living a debt free life.
1) Budget Your Expenses and Income: The reason to budget both your costs and your income is to develop a true understanding of your finances in both how you are getting and spending money. Once you budget your income and expenses you can get a more complete financial picture and begin to plan for the future. Make sure you spend less than you earn and if you are finding that you are not doing so then develop alternative plans to make ends meet.
Dave Ramsey once said: “We buy things we don’t need with money we don’t have to impress people we don’t like.
2) Trim Expenses: Most people have many places they can trim costs. Get a roommate or a smaller apartment. Trade in your car for an older vehicle or use public transportation. Stop eating out. Try many different ways to trim your expenses.
3) Earn Side Money: Find a side hustle to make ends meet and use the money generated to repay debt. Get a second job, write articles online, sell goods online. There are many different creative ways to earn money to repay debt. Find a way to get debt free by doing so.
4) Treat Debt Like an Emergency: If you have debt it is important to understand the terms of it and treat bad debt like the financial emergency it is. Bad debt includes credit card debt and other debt with high interest rates and punitive terms. It is important to pay off this debt as soon as possible. Other debt such as school loans at low interest rates or car and home debt is less important to get rid of and can be
5) Build Up an Emergency Fund: Once you get rid of your bad debt build up a small war chest of money in case something major happens so you won’t need to tap payday loans or your credit cards. Then use these funds to cover unplanned emergencies.
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