Debt Free Financial Advice

The fact is, with careful living and thoughtful planning, a great deal of debt can be avoided. Some people are able to stay away from debt entirely, while others choose to incur debt for what they consider worthy goals, such as education or purchasing a home (see good debt versus bad debt ).

Debt is the natural result of spending more than you make. To avoid debt, you have to be committed to living within your means.

Debt Free Tips

If you aren’t in debt now, follow these tips for keeping debt free:

1. Pay in cash whenever possible. People who pay in cash tend to spend less than those who pay with credit cards.
2. Never charge anything to a credit card unless you are absolutely certain you can pay it off at the end of the month. In other words, only use a credit card when you need the convenience.
3. Save up a cushion of six to twelve months of living expenses. Use this only in an emergency.
4. Don’t spend more than you make. Use personal budget planning to help you control spending.
5. Make sure you have adequate health care coverage and that you have a plan in place for covering deductibles and copays. A significant amount of bankruptcies are related to unplanned medical expenses.
6. Save ahead for a large purchase, such as a car. If you think you earn enough to be able to afford car payments after you purchase a car, you certainly should be able to save enough before you buy a car to purchase it with cash.
7. Never co-sign a loan for someone. If they can’t make the payments, you are responsible for the debt.

This is solid, debt free financial advice. But what if you are already in debt? It will take a lot of hard work, but you can definitely go from debt to financial freedom by following this advice on how to eliminate debt.

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