2 tips for staying out of debt 

On Behalf of | Dec 20, 2023 | Bankruptcy

There are no easy answers in terms of staying out of debt. Millions of Americans are currently struggling with the cost of living through no fault of their own. 

Nonetheless, it certainly cannot hurt to look into different money-saving methods. Outlined below are a few tips that may help you to stay out of debt

1. Avoid using credit when you can

Nobody should go without essentials like food, housing and heating. Additionally, you shouldn’t be penalized for buying something that increases your enjoyment, such as a new TV, vehicle or other items. 

Despite this, it’s important to consider carefully whether or not you can afford to buy luxury items outright. Many stores offer “buy now, pay later” schemes or monthly installment plans. You need to ensure that the total amount you pay back is not well over the market value of the goods and is affordable based on your income. 

There are also numerous credit card and loan companies out there. It can be tempting to take on credit, especially for things you feel like you need. Unfortunately, this is one way that many consumers find themselves facing insurmountable debts. A good rule of thumb is that if you can’t afford to pay for something in cash, you can’t afford to buy it on credit. 

2. Get an emergency fund

It’s surprising how quickly money can be saved by putting away a little on a regular basis. For instance, if you put away 20 dollars from every paycheck, you may soon have several hundred dollars in an emergency fund. 

A fund like this can help to cover unexpected expenses, such as vehicle breakdowns and medical fees. An emergency fund can mean the difference between staying afloat and becoming overwhelmed by mounting debts.   

If you have already become overwhelmed by debt, this is nothing to be ashamed over. Help is available. Seeking legal guidance will give you a better idea of your options.