Secrets to Becoming Debt Free

  • Write down all your debts. Sometimes, writing things down keeps everything in perspective and you get to see which debt should be prioritized.
  • Set up a realistic monthly budget and stick with it. This way, you know just how much should be spent for your daily needs and the amount that should be paid to your creditors.
  • Do not be content with the minimum. If you can afford it, you need to pay for more than the minimum payment requirement. Otherwise, you may end up paying for your debts forever.
  • Limit your spending what you can afford to pay in cash. If you cannot pay cash for something, best not to buy it.
  • Maintain only one credit card. If you have more than one credit card, keep the rest and bring out the one with the lowest interest rate. And if you have to use it, make sure you can pay for the debt within the first billing statement.
  • Build up your emergency fund. This does not really need much explanation. Just make sure you do not spend this fund unless you really have to.
  • Keep your entertainment activities economical. There are several entertainment options where you do not have to spend a dime. Instead of going out on movies, you can rent out and watch at home. Or you can cook a romantic dinner for two. Even if you have debts, it does not mean you can’t enjoy the simple pleasures in life. You just need to find cheaper alternatives.
  • Learn how to bargain. If you have to purchase something, learn how to find them at bargain prices. Or you can time your purchase during sales and discount promotions. By lowering the costs spent on expenses, you can increase the amount allotted for your debt payments and thus achieve financial freedom earlier.
  • Utilize government sponsored benefits. These include medical facilities, community centers and other establishments that can be availed for free or at a low price.