Debt is something that many people can get themselves into trouble for, and it’s often done a lot more when you reach adulthood or at the point where you buy a home or car. There are certainly some tips that can help with making sure you keep yourself financially stable throughout the year. So with that being said, here are some handy tips to keep out of debt in 2021…

Limit Your Credit Card Usage: Your credit card usage is always something to be cautious with because when it comes to credit cards and loans, that money isn’t yours to begin with. Having that mindset is important because it’s hopefully going to motivate you to pay all the money back quicker, rather than dragging it out. Credit card companies will often up the amount you can borrow, depending on how often you spend on it. It’s important that you’re limiting your credit card usage to an affordable amount that isn’t going to exceed your monthly income.

The worst case scenario is that you pay debt off with as much of your income as possible, but that’s not going to always leave you in the best position. If you’re a stickler for putting things on a credit card or getting a loan, then limit how many you get at one time. Ideally, one credit card is enough to manage so try not to exceed what you simply cannot afford to keep up with.

Make A Budget Or Improve Your Existing One: Budgets are a great way of knowing how much you spend each month and the money you have coming in. Some households will have so many different things to pay for, that it can be easily forgotten about when it comes to payments you don’t really need to make anymore. So if you haven’t already got a budget in place, now is the time to make one. There are plenty of helpful templates online or you could always ask your friends and family what they use.

If you do have a budget, then look at what’s changed recently and go through your expenditures to see where you cloud scrap or temporarily remove some. This can really help for you to pay off debts a lot quicker and that way you can get yourself back to normal, enjoying the finer things in life again.

Photo, Arno Senoner.

Find Cheaper Alternatives: There’s always cheaper alternatives to everything in life. For example, when it comes to smoking, you could try eliquids over cigarettes. When you’re doing your food shop, you could compare prices in-store and only buy what’s the cheapest on offer. There are many different ways in which you can reduce your outgoings and keep out of debt, especially if you’re someone who enjoys spending their money.

It’s not something that everyone does, only because it does take a bit more effort on your part to look for those cheaper alternatives. However, it definitely makes all the difference to your expenditures and how much you’re left over with.

Start Saving Into Multiple Savings Pots: A good way to keep yourself out of debt is to practice saving actively. We should all start saving from the moment we start earning money. The reason for this is that there will be times in life where you need lump sums of money, or an amount of cash that might exceed what your monthly income. There’s a lot of savers who are now saving into multiple savings pots in order to help them better their saving habits.

For example, you could have a savings pot for a new car, a savings post for a holiday next year and a savings pot for new furniture in your home. It’s something that can be limitless and you can certainly benefit from it in order to help motivate you to save more money as a result.

Consider Your Spending Habits: Spending habits are something that we all differ in when it comes to what we spend on ourselves and on others. The important thing to remember about spending is to not spend beyond your means and when you know you don’t have the money, don’t spend it.That’s sabotaging yourself and purposefully putting yourself into debt. That kind of behaviour towards money is never a healthy one, so you should try and stop or restrict this where possible.

Keeping yourself out of debt is essential and there are certainly helpful ways in which you can do this. Try to be more conscious of spending and saving money; that way you should be fine.