10 Helpful Tips for Living with Debts


While living debt free is the ideal way to manage your finances, many people find it necessary to incur debt to buy a home, purchase a car or cover other essential expenses. If you are concerned about the debts you owe, there are several practical steps you can take to make living with debt easier.

1. Avoid incurring more debts

When you are already in debt, do yourself a favor and avoid accumulating more bills. Put your credit cards away and pay cash. Save up for necessary and discretionary items and services and put off purchasing them until you have the money to pay for them.

2. Make payments on time

Always pay on your debts on time. Paying late can cause you extra money in late fees and impact your credit rating in a negative way. As long as you have debts, do your best to keep your payments current and whittle away at the balance.

3. Pay off the debts

Pay off the debts as soon as you possibly can. You will create the peace of mind that accompanies living debt free. You will also save yourself considerable bucks in interest payments that continue accruing as long as you have a balance left on the debt.

4. Change your lifestyle

If you are serious about clearing your debts quickly, making lifestyle changes is the way to free up money that you can use to pay bills. Sell that car that you are still paying on and buy a used model that you can afford. Stop eating expensive restaurant meals several times per week and cook at home. Find ways to cut your expenses and eliminate your debt.

5. Visualize a debt-free life

Being faced with debts can be discouraging. Spend time each day imagining what a debt-free life looks and feels like. Imagine the feeling of freedom and independence that will come from knowing you do not owe anyone any money. These images will encourage you to meet your goals of living debt free.

6. Lose your materialism

If you are the type of person who is always had to have the newest and the best, rethink your position. Yes, it is fun to have the newest model phone, fashionable clothing, and nice cars, but is it necessary? If having these things is causing you to incur debt, ask yourself if it is possible to let go of this need and still be happy.

7. Reduce your expenses

Being in debt often causes people to live paycheck to paycheck. Instead of falling into that trap, look for ways to reduce your expenses until you no longer owe money. You may find that these cost-cutting measures are something you can maintain even after youโ€™re debt free.

8. Embrace cheap and free pleasures

If you believe that you have to spend big bucks to enjoy yourself, think again. That kind of thinking could be what landed you in debt in the first place. Check out items from the library instead of buying books and DVDs. Frequent parks, explore the woods and swim in a nearby lake instead of paying extortionate rates to join the local pool. Find ways to have fun without spending money.

9. Focus on what matters

When you have debts, it is easy to become obsessed with what you owe. Instead of focusing on money, think about all the things you have to be thankful for. Maybe it is a loving family, good health, or a warm, cozy home. Take your attention off of what you owe and ponder what you already have.

10. Do not worry what others think

People sometimes find themselves in debt because they are too concerned with the opinions of others. You do not have to have designer clothes, expensive cars, and a big house just to impress others. Consider what you really want. If it is a cheaper option, go for it and avoid accumulating unnecessary debt based on what others think.

Whether you have incurred debts by choice or by necessity, realize that owing money is a temporary condition. Take care of your debts as long as you owe them and then do your best to avoid incurring more once those are paid off.