Once you find yourself in debt, it’s common knowledge that it’s probably already too late for some of your spending habits to correct themselves. And that’s why it’s important to understand that fact in advance of the actual occurrence. If you can look forward in time and see that your current spending habits are going to put you in a debt situation, that gives you more of an impetus to stay out of it in the first place.
That’s where a few tips for keeping yourself out of debt will come in handy. First of all, you’ve always got to watch your credit cards. Secondly, use your insurance wisely. Third, you should always buy the worst car that you can that will get you where you’re going. And lastly, be smart about school loans, whether they are your own or they are put in place for your children’s sakes.
Watch Your Credit Cards
The single best way that you can stay out of debt is to exercise good credit card habits. It’s unfortunate that most kids these days get credit cards before understanding how to use them properly. Yes, it’s good to use a credit card to establish a credit rating, but you need to make sure that you have the finances to back up your purchases at the end of every month.
Use Insurance Wisely
Staying out of debt means using insurance in the most effective way possible. Sometimes this means buying extended warranties on expensive items. Sometimes this means understanding how to use disability insurance to your advantage. Sometimes it means knowing the what type of health insurance you should purchase to get the most bang for your buck. It all comes down to research and comprehension of your overall financial planning, and not basing your decisions on emotional or irrational reasoning. For instance, with planning and research, when asking “what is the best disability insurance for veterinarian?” or a similar question, you’ll actually be able to find the answer and apply this to your financial plans for the future.
Buy the Worst Car You Can
For as much attention as people want to put on buying an excellent vehicle, the fact is, buying a car that is outside of your ability to absorb the total cost means that you will slowly go into debt. That is a mathematical certainty. Knowing that, always buy the worst car that you can get you where you’re going. Buy a car that has scratches and dents. Buy a car that has excellent fuel efficiency but looks terrible. That will keep your initial cost down in the short term and the overall costs down in the long run.
Be Smart About School Loans
If you or one of your children has gone to or will be going to school, you have to be as smart as possible about the loan situation. Too much of the wrong kind of loan, and you can saddle yourself with debt for decades. Make sure to understand all your options before you get into an education loan situation, and then start paying it back as soon as possible.