Debts come in all forms and sizes, and different people get into debt in different ways. Some ease themselves into it after years of bad spending decisions. Others are forced into it after an unforeseen circumstance such as job loss or illness compels them to borrow significant sums of money. Regardless of how a person gets into debt, most of us will need to take similar routes to get out of it.

Sacrifices need to be made in the short term to achieve longer-term financial freedom. This doesn’t mean that you’ll have to live like you’re in abject poverty, but it does imply that you’ll have to modify a few habits. Here’s a list of things that you can cut down on to help you conserve funds that can be used to pay off debt:

Mindless Spending

Cutting your debts down and paying them off will take time and effort – and keeping track of every purchase you make is your starting point. Evaluate your spending habits, draw up a realistic financial plan based on how much you earn, and allocate a fixed shopping budget. You should be able to identify what you truly need versus your wants when you visit the store.

Try spending tracker apps or creating a simple spreadsheet to monitor where your money is going. You shouldn’t see too big an amount – or any at all – going down any unnecessary columns!

Winging It

If you truly want to get out of debt, you have to have a plan in place. You can either make a plan yourself, ask for help from friends or family, or consult with debt relief services experts. A plan will help keep yourself accountable and on track with payments. If you just wing it, you might be able to get rid of your debts, but you’ll most likely get delayed in paying. Worse, you might even incur more debts without a financial plan.

Window Shopping

If you’re one to get tempted easily, window shopping is an activity you should avoid. Not only do you run the risk of straying from your budget plan, you might also get demotivated or unhappy if you aren’t able to buy something under your “Want” column.

Grocery Shopping Without a List

In relation to window shopping, going to the grocery store without a shopping list might trigger impulse buying. The things you buy may be something you like or consume (like food), but these extra expenses add up and make it more difficult for you to pull together your cash. If need be, schedule a dedicated trip to the store when you’re going to buy little treats and extras.

Email Subscriptions that Encourage You to Spend

These days, online marketing is a money-spinning enterprise. People receive special offers in their inbox weekly or even daily, with big banners proclaiming that you’ll save a huge deal if you buy now. Instead of simply deleting these emails, it’s better to unsubscribe so you’re not tempted to spend.

If you don’t want to completely unsubscribe or plan to make a purchase in the future, set up a separate email account for these marketing emails.

Storing Payment Details in Apps or Online

Online purchases take only a few quick clicks to complete. These practically immediate transactions can be detrimental to your goal in eliminating debt. By not storing your payment details, you’ll add some extra steps to online shopping, which may discourage you to click that “checkout” button. It’s all about keeping your money safe from situations that make you spend unnecessarily.

Touching Your Emergency Fund

Emergency funds are just that: reserve money for urgent situations. It can be tempting to draw from this account and pay off some (or all) or your debts, but that leaves you hanging without a contingency plan. If an emergency strikes, it might even throw you back to your original situation: taking on a new debt to address the emergency.

The ultimate goal is to get out of debt, so you may have to live without some of your comforts and conveniences for a while. However, you can rest assured that you’re covered when an emergency situation occurs.

Cashing in Your 401(k)

Similar to keeping your emergency fund intact, don’t cash out a 401(k) to pay down debt. The penalties and taxes, usually a ten percent penalty on top of your tax rate, will basically result into a high interest loan. If you prefer, you can slow or stop contributions to these holdings while you’re getting out of debt, rather than take money out of these to help pay your loans.

Ignoring Your Bank Statements

Your bank statements and credit reports will help keep you in the loop and motivate you to push harder in getting out of your debt situation. There’s something satisfying in seeing your progress on record.

Paying careful attention to these documents should also help in monitoring if your records are up to date. Credit companies sometimes make mistakes, and these can be difficult to dispute if not reported immediately.

More Debt

As much as possible, don’t take out more loans while you’re still paying off your current debts. Unless you’re opting for debt settlement, more debts would just mean digging yourself deeper into trouble. Pay in cash as much as possible and follow your plan set by your debt relief expert to the letter.

There’s no cookie cutter solution in getting out of debt, but with dedication and knowledge of what to do and not do, you can pay off your debts and achieve financial stability.

Debt Relief programs eliminate your debt in the best possible way. At CreditAssociates we have a special team of experts to help you break the debt cycle and provide you the tools and knowledge to secure your financial future.

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