Question by Anonymous: What are good tips to avoiding debt and saving money?
And have you found it hard to carry out such ways?
Best answer:
Answer by Caren B
cut out any bad money habits like eating out constantly and gambling and over-spending. when you have the impulse to do any of these, put some money in the bank or get a money order to cash later in you rbank account
Know better? Leave your own answer in the comments!
Yes in the past I have found it hard to do this, but now I am okay. A good tip for avoiding debt is knowing that everytime you buy somehting on a credit card you are financing or taking a loan. Ex. If you go out to eat and pay with a credit card you are taking a loan out to eat. Simply buy what you need to survive. You can splurge every now and then but try to save your money.
It can be hard to carry out such ways. Automatic transfers are a good way to do this, where you set it up so the savings is taken out and to your savings account automatically. Locking savings that you know you will not need in a CD is another good way to keep yourself from spending it on things you want but don’t need.
It is also a good idea to only have one credit card with a limit that you know you can afford to pay off every month.
I pay for everything (but my home) with cash. Read Dave Ramsey’s Total Money Makeover and you’ll see it can be done. Paying cash really does work – you are much more conscious of what you buy and how much you spend. When you count out those dollar bills it really hits home. And by paying cash you are guarenteed not to go into debt. Like I said the only thing I have a loan for is my home and I’m working on having it paid off 17 years early – hopefully by 2012. I bought both my cars with cash and tomorrow I’m going to buy some furniture for my living room with…cash.
Stay away from credit cards for one.
Stay away from borrowing in general.
Pay as you go and live on less than you make.
Save and get a cash car.
No payments = cash in the bank.
Use a written budget.
As long as you spend less than what you earn and have a personal budget (that includes savings) you can never go wrong. The first step in staying out of debt is to shred all of your credit cards and throw them in the trash where they belong. Then try the envelope system. Label a few envelopes with categories out of your budget; entertainment, SAVINGS, food, gas, etc. Fill each envelope with however much (cash) you want to spend for the month (or week). Whenever you need to make a purchase, pull money out of the appropriate envelope. It’s a simple, easy, and almost foolproof way to limit your spending and save money.
Once your budget is in place and your spending is under control, you’ll have a much easier time avoiding debt.
Stop buying things that you don’t need.
Stop watching TV (which makes you want to buy things that you don’t need).
Train yourself to be a cheapskate. Everytime you think about spending money on something stupid, just punch yourself in the face. Its like Pavlov’s dogs. Eventually you will associate stupid purchases with pain and only want to save money.