While getting out of debt is one thing, staying debt-free is a different ball game. Repaying debt is an uphill task, but you can do it with the right debt repayment strategies.
The trick is remaining debt-free and to do this; you must stay disciplined and steadfast in working towards your financial goals.
Here are 5 top tips to help you stay debt-free permanently:
1. Build Your Emergency Fund
We often fall into debt because unexpected emergencies arise, and there is no financial cushion for it.
The best solution to this is to build your emergency fund. It should contain 3 to 6 months’ worth of living expenses in an easily accessible fund.
Avoid falling into unnecessary debt by building your emergency fund.
2. Cut Off Unnecessary Expenses
Another possible reason you keep falling into debt is mindless spending.
You might be paying too much for services or unknowingly spending on things you don’t use, causing you to fall into debt.
We recommend regularly reviewing your finances to identify and cut off unnecessary expenses. Here’s our guide on how.
3. Increase Your Income
If you end up borrowing because you’re trying to meet up with expenses, the simple solution is to get more income streams.
Simply put, you might need a side hustle. The good news is that it’s now easier than ever to make money online.
To stay debt-free and meet up with the bills on time, increase your income streams.
4. Budget and Track Your Spending
To avoid falling back into debt, you must be disciplined enough to create a budget and track your spending to ensure that you stick to it.
Remember that your budget should give you an allowance to treat yourself.
This keeps you encouraged to stay on track and can reduce the likelihood of falling into debt due to impulsive spending.
5. Avoid Emotional and Impulsive Spending
Buying things you didn’t plan for or shopping while you’re emotional can quickly drain your finances.
Try your best to ensure all your purchases are planned for in advance. Even if they weren’t, give yourself time to think about it before going ahead.
Also, be sure not to shop in an emotional state.
You can live the debt-free life you’ve always dreamed of.
You need to have the mindset that debt can be kicked out of your life for good and take conscious steps to achieve this status.
Be disciplined, set your mind to it, work hard and stay motivated on your journey by getting an accountability partner.
Know any other tips? Tell us in the comments!
OUT OF DEBT, OUT OF DANGER.
– JERRY VOORHIS
Visit www.overwood.ng today to safely save towards your financial goals for the future with the best, high-yield savings options in Nigeria.