avoid getting into debt

How do I avoid getting into bad debt?

The way to avoid debt is to spend less than you earn every single month. Spend less money on unnecessary things. Avoid just spending money to fill your satisfactions.

Control Your Budget

Controlling your budget is the most important factor in determining your long-term financial well-being. Do not get a credit card, rather get rid of the ones you have. Many people use credit cards for means of emergencies.

That’s where saving money comes in. one should save for emergencies, be it car, health, house repairs etc. don’t rely on credit card for emergencies. Rather than taking out a loan for larger purchases such as cars, furniture or a house. Save up for items like furniture and invest your money somewhere where it can grow such as shares or property.

Avoid Loaning Money

Never take out loans. It may be easy and convenient but it only lands you in debt. Nowadays the option of taking out a loan for large purchases is very common. It’s better to save up for something that you want.

It may take some time but it’s better than taking out a loan that you will struggle to pay off. Open a savings account. You don’t have to put large amounts of money in it. Save what you can.

Invest Your Money

Investing your money is good for long-term goals that you would like to achieve. One can invest money in shares for 10-15 years and then buy a house with the money accumulated. This is more convenient than taking out a loan and having to pay it off later. Invest your money where it can grow to benefit you in the present and/or the future.

This is more convenient than taking out a loan and having to pay it off later. Invest your money where it can grow to benefit you in the present and/or the future.

Pay Your Bills on Time

Paying your bills on time not only eliminates chances of falling into debt but is also a big advantage. Not only does this dodge spending money on leisurely items but it also increases your credit. If you want to own your own home someday, pay your bills on time. It improves your chances of owning a home.