Are you in the debt or in the process of getting out of debt? Well, today is the start of a new week and a chance to face new challenges. So why not focus on getting out of debt and staying debt-free. Being in debt is not an easy place to be, but it's important to stay positive and focus on the end goal: being debt-free!
Here are 7 simple lessons from Mint.com to help you stay on track, avoid a debt relapse and keep you out of debt for good, enjoy!
1. Loosen up on the budget and breathe, just a little.
You’ve come a long way and now you’ve earned a little breathing room. Don’t go crazy, but do give yourself permission to spend a little more on creature comforts (so long as you can really afford them) so that you don’t feel so deprived. Moderation is key.
2. Pay with cash
Or charge only what you have the cash on hand to cover. Look, credit cards aren’t 100% bad. It’s the temptation and how we use them that can be bad. Doing away with credit cards altogether could impact your credit and your ability to leverage money. Therefore, make a promise to yourself — especially if credit cards are a weakness for you: limit the number of cards you use to two and only charge what you know you can pay in full when the bill comes in.
3. Don’t splurge. Plan.
If you want to take a cruise or buy the latest HD TV, plan the purchase and save the cash upfront. This won’t give you the instant gratification of getting what you want “right now” but if you plan it, you can still get what you want without the guilt of spending money you know you don’t have and racking up debt that will weigh you down later. Plus, if you’ve got the cash on hand, you can still charge it, pay it off immediately, and benefit from any credit card rewards that may be available to you.
4. Identify your money triggers.
What is the one thing that you find very hard to resist buying? It could be the latest electronic gadget, clothes, art, vacations, eating out — you name it. It’s the one thing you just can’t seem to stop yourself from spending money on if it’s right in front of you. These are your money triggers. By identifying your weaknesses you can avoid impulse spending by removing the temptation — or by avoiding the temptation altogether. Mine happens to be electronic gadgets. It seems I can’t walk into an electronics store without dropping a few hundred dollars, so I just remove the temptation by avoiding those stores entirely. And when I do need something, I order it online to keep from having the merchandise right in front of me. It’s just too tempting for me to resist.
5. Redirect the money you spent on debt payments each month to savings.
After you’ve paid off all your debt, take the extra money you now have each month and continue making those same payments towards your savings instead. Every penny saved is another penny towards financial insurance for unexpected financial emergencies. Everyone should have an emergency fund, and with the state of unemployment and the current economic outlook, the old standard of saving enough to cover your expenses for 3-6 months is now closer to 8-12 months for emergency funds.
6. Develop a support group of like-minded debt-free friends.
If the people who surround you make it hard to stick to your debt-free lifestyle, it’s time to create a new support group of those who will. They’ll relate with your struggles because they’ve been there too. When your family is upset because you won’t join them on a cruise for next year’s Christmas holiday (when you can clearly charge the excursion), your support group will stand behind you and cheer you on for making the right choice, despite any guilt or pressure from family and friends that want you to “keep up with the Joneses.”
7. Never forget the nightmare of how living with debt felt.
The last lesson, and probably one of the most important, is to never forget the everyday stress and anxiety that you fought so hard to eliminate from your life. You were there once, and remembering how it felt can be an incredibly effective reminder of why you continue to fight every day to make sure you don’t fall back into the same destructive pattern.
[All credit to all 7 Ways to Avoid Self-Sabotage and Stay Debt-Free for Life goes to this Mint Life article]