5 Ways to Avoid Unnecessary Debt
With the argument still looming over unemployment extensions, jobs becoming more fragile and everyday expenses (ex. gas prices) getting to be too sporadic to budget for, it’s growing increasingly easy to end up in debt. However, there are some reasonable steps to take to avoid unnecessary pitfalls that will immediately land a person into debt.
Pay attention to bill packaging
Companies often market deals that help people “save” money but don’t necessarily do so. For example, if a consumer is only watching basic cable channels but paying for extended cable, that’s an unnecessary increase in bills. Downgrade to a plan that’s regularly utilized. Don’t feed into the scare tactics that companies use about “bundle” programs and how consumers will lose so much money if they don’t purchase bundles (ex. cable, telephone and Internet). Ask the company to break down individual pricing. Some bundles have hidden charges included (ex. DVR or modem rentals) that increase the bill. Without rentals, bill pricing may decrease.
Ditch the house phone, home fax
Pay attention to how often a mobile phone is being used versus a house phone. If a cell phone package has unlimited minutes, unlimited long distance, and unlimited local and local toll calls, what is the purpose of keeping a house phone? One reason to keep an additional line is for a fax number. However, if a fax machine can be used at work or by scanning documents for online faxing, paying for additional phone service may be a waste of money.
Be willing to say “no” to loans
Family and friends depend on each other in times of need, but sometimes that same social circle will pay more attention to their own financial needs than others’ financial needs. Your checking account and credit cards should not be treated like someone’s bank loan office. If you can’t afford to lose it, don’t lend it. And don’t let people get in the habit of habitually borrowing money and making excuses why they can’t pay it back in a timely fashion. Remember it is your money. You have your own bills and financial woes to worry about. If you have a family, your first financial priority is to them, rather than lending it out to friends or non-immediate family members.
Talk to a financial professional
If two people have the same poor spending habits, it may be time to bring in a third party to provide advice for what’s going wrong. Consider hiring a financial consulting firm like D Thode & Associates to evaluate financial decisions and help with budgeting. A financial advisor can provide you with helpful information on how to budget your money. They can also help set up your own personal budget plan for each week, month, and up to a year. This will help you avoid trouble with creditors and keep you away from bankruptcy. These advisors are there to help, but they are also there to help hold you accountable and keep your finances on track.
Use cost-cutting digital apps
It may seem like a pain to clip coupons, but it’s never a pain to save money at checkout. If monitoring, organizing and clipping coupons seems like a hindrance, try smartphone apps, such as Shopkick, that give cell phone owners points just for walking in store doors or scanning items. If done on a regular basis, it’ll be rare to not save money on every other shopping trip.
Saying “no” to spending, “no” to loans, “no” to entertainment perks and “no” to keeping spending habits to yourself may seem overwhelming at first. However, with some discipline, an open mind may lead to a higher checking account balance.
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Category: Debt
