Debt-free living

How to live a debt-free life?

In a world where the majority of people are carrying some sort of debt, is it really possible to live a debt-free life? Yes you can. Even though life is really expensive and it sometimes feels like you need to have a miracle in order to pay your bills without going into debt, there are actually things you can do to improve your budget management. As you may know, getting out of debt can be really, really hard. Even though there are many ways and financial tools and methods that people can use to fight debt, that battle is never easy. If you are at a stage in your life where you have still managed go live a life free of debt and you are finding it harder to continue living that way, you may have just come to the right place. Instead of focusing on how to get out of debt, we will rather focus on what you can do to never find yourself in debt in the first place. Even if you are already carrying debt, you may still find some useful ideas that you can try out and improve your financial stability. If you are someone who is trying to manage all his financial problems without going into debt and are barely able to do it, you will find the tools to help you sustain your free of debt living.

How to live a debt-free life?

Debt-free living
Debt-free living

The truth is that people go into debt for a number of different reasons. It is really hard to point out a single factor as the main reason for being in debt. Every person’s situation is different. Regardless of what your specific situation, if you are making bad financial decisions, you will naturally face the consequences of those decisions. If you are making the right choices about your financial life and doing all you can to sustain a stable financial state, you will always see the benefits of all these good financial decisions. With that being said, regardless of where you live or what you do for a living, being able to live a life free of debt starts with you, your mindset, the way you look at the world and the financial decisions that you are making. So if you are battling debt or you have still somehow managed to live without going into debt, but you feel like that is exactly where you are heading, here are some things to get you on the path to debt freedom:

 

  • Stop spending money on things that you do not need

 

Stop spending money on things that you do not need
Stop spending money on things that you do not need

This is possibly one of the things that really differentiate the people who are living a life free of debt and those who are deep into debt. If you are spending your money on something that you will not even remember in a few days, it is most likely not worth your money. By spending money on such things, you are basically throwing that money away. If you are finding it quite hard to figure out which of your expenses you should cut off, try collecting your bank statements, credit card statements and receipts to actually track down all your expenses and see exactly where your money goes.

 

  • Cut out fancy restaurants

 

Cut out fancy restaurants
Cut out fancy restaurants

It is always nice to go a good restaurant. However, if you make a habit out of it, you will soon see the cash disappear from your pockets. Going to a fancy restaurant is great if there is a special occasion. However, if you start going to such places on a regular basis without really having the level of income to support that lifestyle, you would soon realize that not only are you spending more than you can afford, but that these actions will inevitably get you in debt. Keep in mind that you can still celebrate or show someone that you love them even if you cook a meal at home. In fact, cooking the food yourself can show even more love and dedication than a fancy restaurant dinner.

  • Fast food chains

Fast food chains
Fast food chains

Fast food chains are not only unhealthy, they also get you to spend more money than you should. While most people realize that, they are still going to fast food chains and eating there. The most common excuse for that is that they simply do not have enough time to prepare food at home. However, this is just an excuse. If you start doing meal-preps, you will soon realize that you actually save more time, money and you will be eating better food overall.

 

  • Instead of buying a house, rent a place

 

For many Americans, the American dream has always been associated with buying a house. However, the problem with buying a house is that it is simply way too expensive. In order to do that, many people are accepting to live the rest of their lives in debt so that they can afford to buy a home. Once you commit to a mortgage monthly payment for the next 20-25 years, you are not leaving yourself much space for other choices and directions in your life. And of course, when you buy a house, the mortgage payment is not all that you would need to think about as there are more payments like property taxes, home ownership insurance, higher utilities, association fees and others. As a result of all that, many homeowners are left in an awkward position. They love their new home, but they barely have enough money left to live a normal life. So what they often do is going into other debts like car loans and credit card debt to afford all the other things they need. It is just not a great way to live your life. Instead, you can maybe do the following:

 

  • Rent a smaller, more convenient apartment

 

Find a place that gives you enough space so that you can live according to your needs. We all want to live in big, expensive houses, but do we really need that?

  • Location

One of the things that you should be focusing on is the location of your place. Is it close to your work place? Is it close to the places where you like to spend most of your time when you are outside? If you can find a smaller house or an apartment in a really good location, you may actually find it to be a much better choice than a big house in a bad location.

  • Efficiency

Efficiency
Efficiency

Just because a place is small does not mean that it cannot be more efficient than a much bigger house. If it is well organized and constructed, a smaller place can give you all that you need in a more efficient manner compared to an unnecessarily big house. So when you are looking for a place, efficiency should be one of the deciding factors.

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