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The Secret of Staying Out of Debt

24 November 2015 No Comment

8 Unfortunate Events That Can Deplete Your Savings AccountAlmost everyone you meet is an expert in something, and this is also true for the financial market. With the amount of self-professed experts running around, it’s no wonder that financial management is confusing and so many of us have landed ourselves in a mountain of debt.

It’s time to focus on what the real financial experts are saying on how to control our finances. In fact, we should be taking their advice long before we even land ourselves in a bad debt situation. We should be making positive financial choices and decisions in order to keep our finances on a positive roll and to keep us out of debt altogether.

As many financial counselors will tell you today, the first and most important step to staying out of debt, boils down to a monthly budget. Now you may have heard this being said before and laughed it off, but research shows that if you have a set monthly budget, and a financial goal in mind, you are less likely to overspend and more likely to use your money with caution.

The key to successful budgeting is to be honest with yourself and your finances. Be clear on exactly what your monthly income is. Don’t include estimates or potential sources of income! Calculate purely on the sum of cash that you actually receive monthly, and if there are some extra sources of income that come into fruition that weren’t calculated into your original budget, you can add them in for the following month, or quite simply save that cash straight away.

Now you need to know what you’re spending, and don’t be shy when it comes to this. A few dollars here and there add up, even if you don’t think it’s very significant. Armed with this information, set a realistic monthly budget based on necessities and luxuries. Cut out a few luxuries in order to balance out the numbers and lastly, stick to it! If you are diligent about your spending, you’ll keep yourself out of debt and you may even surprise yourself with some surprise savings!

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