Ever wondered why you are always stuck in debt? Well, it could be due to a lot of reasons. Here’s how you can get out of it easily.
Money is one resource that is never enough. You can always hear people complain about being low on funds or how much they constantly owe.
But, why is that? What keeps us from living a satisfied, debt-free life? And more importantly, why do we always find ourselves in debt? Let’s find out.
Additional Reading: Smart And Easy Tips To Get Out Of Debt
Whenever we talk about managing money, it always boils down to savings and expenses. But, is that all that matters? The answer is a big ‘NO’! We believe that there is more to it than just how much we earn and how much we spend. Your attitude and approach towards saving and spending money matters as well.
Here are a few ideas that can help you build a better relationship with money and eventually lead a debt-free life:
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Set A Simple And Easy-To-Follow Budget
When setting a budget for ourselves, most of us usually create a stringent one. While this does help us save a lot of money, it usually spells trouble, especially when starting out.
The reason for this is the sudden impact a tight budget will have on our lifestyle. It’s like asking a chain smoker to quit smoking all of a sudden. It always ends up in failure.
Here’s an easy tip. Start by monitoring your spending habits first. Maintain an expenditure diary for a month. At the end of the month, analyse your spending pattern. This way you’ll be able to identify any unnecessary expenses and rule them out. The key is to gradually reduce spending on unnecessary things every month. Simple, isn’t it?
Additional Reading: A Superbly Easy Way To Keep A Budget
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Stay Away From Get-Rich-Quick Schemes
Many people out there fall for ‘get rich’ schemes. After all, who doesn’t want to get rich overnight, right? Unfortunately, most of these schemes turn out to be scams.
Remember, there really is no shortcut to becoming rich. Whether you like it or not, it takes a lot of time and effort to build your wealth.
Here are a few simple tips to avoid falling into get-rich-quick traps:
- If a scheme sounds too good to be true, it probably is.
- Any scheme that promises a lot of money in a short span of time is a trap.
- Don’t trust any emails or online sites that promise to make you rich if you send them a specified sum of money (no matter how small the amount).
There are a lot of legal ways to accumulate wealth. Invest smartly and you’ll grow your bank balance over time.
Additional Reading: How To Identify An Email Scam
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Reign In Your Credit Card Spending
Are you dependent on your Credit Card? Do you often reach for your Credit Card every time you see something in the shop window?
If you are really seeking solace from debt, then you need to keep your Credit Card spending under wraps. If you don’t have enough cash to purchase something, then try and resist the temptation to charge it to your Credit Card unless it’s absolutely necessary.
Additional Reading: This Is Why You Spend More On Credit Cards
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Learn To Spend Smartly
With budgeting, you’ll learn to spend your money in a smarter manner. We aren’t asking you to live a completely frugal life, but it’s always advisable to think twice before you make a purchase. Ask yourself if you really need whatever it is that you are buying. Learn to differentiate between your needs and wants.
In addition to the above, you have to be smart when buying stuff. Explore different options. Look for sales and discounts. Go to a flea market and buy stuff at cheaper prices. Even if you impulse buy, you can save a lot of money if you are smart with your purchases.
Additional Reading: Smart Money Moves With A 2000-Rupee Note
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It’s All About Attitudes & Habits
For starters, let us tell you that saving money doesn’t have anything to do with how much money you have in your account. You may be putting aside a large sum of money every month, but if you keep over-spending on a day-to-day basis, you’re basically exhausting your own savings.
Now, think of saving money as a way of life. You would have set goals and plans for yourself and your family. Your only aim should be to work towards accomplishing those goals. And when you understand that you need a huge money reserve to reach your goals, you’ll automatically engage in sound money management practices.
In a nutshell, saving money requires adopting new attitudes and habits.
Additional Reading: How Gen Y Approaches Finances
Now that you know how to get out of debt, it’s time you correct your bad financial habits and turn over a new leaf. Psst! We have great offers on Credit Cards and Personal Loans to help you tide through difficult times. Contactless KYC via video also applicable on select bank products too. Hurry, check them out!