- Personal Finance
How not too get into debt
Everybody knows what debt is and everybody knows that when you want to get out of debt that it can be hard. Every where you look there are always businesses and advertisements that say they can help you get out of debt. If you have a loan you fell behind, credit cards that you can't pay or other payments that you fell behind than chances are there are over one million businesses that can be found on the Internet that will say they can help you get out of debt.
Debt is responsible for the world economic crisis and people seem like they just do not get it. They wonder how it ended up this way and if the economy will go back to normal. The only way things will get better is if people prevent debt from ever happening in the first place.
Below are ways to prevent debt and to motivate people to not take easy ways out. Some tips and advice on preventing debt are also listed below.
Credit cards- No matter what you think or what you are being told or anything, getting a credit card is bad news and is almost a guarantee to putting yourself in debt. Yes you need to build credit so the smart thing to do is to make sure you have funds to pay off the credit card right away. Also make sure you that you get a credit card with the least amount of money on it and even if the company increases your limit make sure you only buy little stuff. Always make sure that you can pay off your credit card every time you use it. For example if you have five hundred dollars on your card, spend only two hundred in a month and pay back the full two hundred instead of the minimum payment.
Store credit cards- Almost every retailer both big and small seem to be offering their own charge cards that can only be used for their stores. Do not get these cards because whatever you want at that store you can simply work and save the cash. A regular credit card is better than these types anyways because with regular cards you can use them anywhere and not just one place. These cards can rack up debt real fast.
Save money- No matter what situation or financial position you are in the only way to get ahead with money is to save no spend. IF you don';t have debt than it is easier to save than you might think. Try to put in at least a third of what you are earning on a weekly basis, no matter what. Eventually it will add up and after a year or two you will be very surprised at how much you have saved.
Buy a car with cash-Either buy a cheap car in cash or find a car that you will only have to take a small loan out for. If you think that you need a loan than try to get a loan for no more than five thousand dollars because this is relatively a small amount that can be paid back quickly. Don't just make the minimum payments, try to pay as much as possible because the faster it gets paid off the faster you will have good credit and a good credit score.
Start young- If you are under the age of eighteen or close to the age of eight-teen than you are in a great spot. The best thing for you to do is to build a little credit without building debt. Remember to save, take out real small loans that can be paid back fast. If you follow these steps than you will have a good credit score as well. People end up ruining their credit score startong at a young age and that debt follows them for a long time to come.