How to Eliminate Debt
Unsure what is meant by living within your means? Well, in order to soundly balance present needs with future interests, there are a few financial rules which you can use to gauge if you are living soundly, or stretching your resources too thin.
Rule One: Live in an Affordable Space
Experts in financial management agree that you should not spend more than 25% to 35% of your income on lodgings. If you are paying more than this for your home and utilities combined you, should probably consider downgrading to a less expensive residence, so that you can afford a nicer one in the future.
Rule Two: Limit Variable Spending
For members of the middle class, the most damaging and avoidable financial faux pas is uncontrolled spending on luxuries. Take, for example, a nice evening out such as a dinner for two, costing somewhere between $30 to $50 a meal, whereas the same thing enjoyed at home would cost under $20. Even without doing the math, it’s obvious that doing this even just once or twice a week can add up to a horrific loss of income. Do yourself a favor and save restaurants as a treat for special occasions, you’ll enjoy it more.
Rule Three: Stop Carrying Month to Month Balances
The convenience of tools like credit cards are quickly outweighed by the sometimes crippling interest rates they charge. A $2 bottle of soda on a credit card can sometimes balloon to a $10 expense if left to swell, so just don’t do it!
If you have already fallen into the credit card debt trap, make repaying these coffer killers your top priority after monthly expenses are paid. The sooner you stop carrying that month to month interest, the sooner you can breathe easier.
Military Debt Consolidation Advice is a resource for those wishing to learn more about debt reduction, financial planning, and other related topics, with a focus on services that are available for military members.
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