There is simply no way that the average person can eliminate debt and start building wealth without making serious changes to his or her lifestyle. Those who don't change how they live won't be able to get rid of debt or build wealth.
The first step in eliminating debt should be to take a look at your lifestyle and drop habits that lead to debt. This could mean that you should stop carrying credit cards and do less shopping. Try to find alternatives to going to the mall or other places where you are likely to buy more.
Simple steps such as bringing your own lunch to work, driving less and eating out less often can help save money. So can paying off credit cards and other debt instruments.
Saving and Budgeting
The two most important lifestyle changes that can aid wealth building are saving and budgeting.
Saving simply means paying yourself, first. When you get paid take a portion of your income and put it aside for future use. Put the funds in the savings before paying bills or other expenses. If you receive your pay check or government benefit by direct deposit you can simply have 10% go to your savings.
Budgeting simply means having a plan for saving, spending and investing your money. Creating a budget and sticking to it can help you save money. Never create a budget without knowing how much you spend first. A good way to decide this is to make all your purchases with a debit card then use your bank statement to see what you're spending.
This way you can decide how much to save and identify expenses that can be trimmed or eliminated. You could be surprised by how much you waste on things like fast food and coffee.
Don't Make Yourself Miserable
Many people don't save money or budget because they equate such things with misery. They don't want to budget because they're afraid budgeting will eliminate fun from their lives.
If you want your budget to succeed add some fun to it. Put some money aside for fun activities l ike movies or eating outside. Identify luxuries or creature comforts that make your life bearable such as cable TV or eating out and keep them. Eliminate luxuries you don't use very often.
Persons who make themselves miserable with budgeting, won't stay on a budget or cut their debts. Individuals that have a little fun can stay on budget.
Another way people make themselves miserable and don't save money is by wasting too much time and effort on money saving efforts that don't save money. Examples of this include coupon clipping, bargain hunting and do it yourself projects. In many cases these don't save money, take up lots of time and end up making the family miserable.
Don't spend time and resources on a money saving activity unless it saves you a significant amount of money.
Alan Pavan invites you to discover the secret to your debt free future at: http://nodebt9.com
No comments:
Post a Comment