 |
Start Here:
Important Site Sponsors
|
|
Debt Prevention - Living
Expensively Catches Up
Like it or not, as Americans, our lifestyle is starting to catch up with
us. The need to spend, to have the latest thing, to better ourselves with
high end items is an all-consuming need that affects millions of individuals
throughout the US, and has led many of us into debt problems. This can
mean living from paycheck to paycheck, and paying off credit cards using
the minimum payment plan, which is great for credit card companies, but
awful for you (compare the minimum
payment plan with our program here).
We all want the best for ourselves, and there's not a problem with that.
But when you are spending above your income level, there is nothing you
can do but change. Although getting a raise, as an example, might seem
to help, studies show that generally, as your income goes up, so does
your spending. The point here: if you're spending well above your income
right now, you'll likely spend well above your income when you make more.
The more you make, then, the more you'll spend.
Can We Live Within, Or Even Below Our Means?
A lot of people have a goal to "live within their means". At Debt Consolidation
Advisors, we always push a "redefinition" of this goal. You shouldn't live
within your means. You should live below your means! That way, if something
comes up in your life (which inevitably happens), you will be ready. It
is simply not enough to "live within your means", as this implies that you
may not be incurring debt, but also are not saving anything.
It's a simple fact: Emergencies happen. And if you don't have an emergency
fund which can help you in cases of job loss or medical problems, you may,
like many Americans, have to turn to credit to help. The problem with this,
however, is that this is the quickest and easiest way to get over your head
in debt.
Create A Plan
The Boy Scouts were right: Be Prepared. And that means you may have a change
or two to make. Living below your means is not only possible, it is also
a practice that many of the richest Americans have taken to heart. It's
also, in some cases, one of the key reasons why they are rich in the first
place! We should note also that these people do not live in squalor, but
instead understand that spending less than they make is critical to financial
success. This kind of living, of course, is best accomplished with a plan.
Planning to live below your means doesn't require much. First, you must
determine how to budget. And stick to it. It requires determination, but
can be done. Take a look at how much you make, and then develop a plan of
what you can spend each month, and what you cannot spend on. Categorize
the basic things you need to live, and take a long, hard look at the things
you really do not need to live. What you're doing here is simply dividing
what you buy into needs and wants.
Get A Spending Buddy
Having a buddy who can tell you when to stop spending, and when you're starting
to "fall off the wagon" when it comes to spending. This person is the only
person outside of yourself who will keep you accountable. So get a buddy.
Pay Yourself First
Although you've probably heard it before, the concept of "paying yourself
first" does actually work. Taking a percentage of your weekly or bi-weekly
paycheck and instantly putting it into a savings vehicle (particularly one
which does not let you withdraw easily!!) can give you some real discipline,
and force you to start solving your spending problems. And, the most important
point is that it's a whole lot easier to save money when you actually have
it, than at the end of the month, when you may not.
So take a look at the things in your life. Are you spending more than you
make? Are you buying too much from the "wants" column? The best way to change
is to do it quickly.
Need help with your credit card debt? Contact us here for a free
debt consultation.
|
|
Debt Solutions