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No More Debt, 3 Radical Debt Reduction Strategies You Can Do

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<p>You know the saying, "When you hit rock bottom the only way to go is back up." I'm sure that this is where many of us begin our journey to becoming debt free. This is when you truly want to live a life with no more debt. What does rock bottom look like to you? Maybe you don't really know how much money you owe in total because you are in denial about the whole thing. Every month you are making the same amount of money but you are short every single time. You are stressed out to the max that you are moody and snappy at everyone around you. Maybe you haven't had a good night sleep in months because all you can think of is how you are going to pay all the bills. You wonder how the heck got to this point in the first place.</p>::PexelsYou know the saying, “When you hit rock bottom the only way to go is back up.” I’m sure that this is where many of us begin our journey to becoming debt free. This is when you truly want to live a life with no more debt. What does rock bottom look like to you? Maybe you don’t really know how much money you owe in total because you are in denial about the whole thing. Every month you are making the same amount of money but you are short every single time. You are stressed out to the max that you are moody and snappy at everyone around you. Maybe you haven’t had a good night sleep in months because all you can think of is how you are going to pay all the bills. You wonder how the heck got to this point in the first place.

It seems so easy to get in these types of situations, yet so tough to get out of. That is why it takes drastic and radical changes to begin to dig yourself out of the hole that you created.

Here are 3 radical ways to dramatically reduce your debt.

1. Liquidate

Have you ever gone to a store liquidation sale? This is exactly what you need to do with your life. In this day and age, you have countless ways to try and sale items. If you have nicer items you can post on Ebay, apps like Poshmark, and even local Facebook groups. For everything else, you can have a huge garage sale and even try to sell to consignment shops too. Not only will this put major money in your pocket, but this will help clear the clutter from your life and give you more breathing room. Go through your house with the entire family. If you think you have a lot of “junk” guess again. Sometimes the junk is what other people are most interested in at garage sales. It’s worth a shot to try and sell everything you don’t need.

Many people even take drastic steps by selling their vehicle/s that are not paid of. Buying something cheap with cash and putting the extra toward their debt. Sounds pretty lame, until you realize you won’t have that huge care note hanging over your head every month, your car insurance will decrease too.

If you are really overwhelmed with your debt. Consider selling your home and get in a rental. See what your local housing market is doing. If you have been in your house for several years, you might have some equity built up. Even if you are paying a couple hundred less than your mortgage now you also won’t have to deal with house insurance and any maintenance issues that can put a dent in your monthly budget. If you downgrade to smaller square footage your utility bill can reduce drastically and other expense can decrease as well.

2. Cut Expenses to the Bone

Sit down and figure out all your bills you have for the month. What can be cut out? Cut cable completely or downgrade package, cut pest control maintenance. Monthly subscriptions are very popular. If you are signed up for several monthly subscriptions like razor clubs, IPSY, bark box, any magazine subscription, as well Netflix and Hulu. It’s time to cut them all. Even if they seem relatively inexpensive they do add up so serious cash. Don’t forget to cut out that gym membership as well.

If you have anything set up under a contract consider calling each of them and asking what the cancellation fee amount is. If it’s not worth to cancel and pay the fee ask them if you can drop your package deal to anything else less expensive until you can cancel. Call you credit cards to see if they can lower your interest rates. Lastly, this is also a great time to call your insurance company and shop around to see if you can get a better rate for home and car insurance rates.

Why do you want to cut all this out? Because you will be too busy doing step #3.

3. Bring in More Cash

After cutting out all items that you don’t need you’ve made a little bit of breathing room. Now, to really get the progress rolling you need to bring in more income. Many people opt for a second job or even start a profitable side business. Many people opt for a part time gig in the evenings and weekends like a grocery store, delivering pizza, clothing store, or a restaurant. If your family is keeping you from going out to the work force in the evenings and weekends you can also look into part time stay at home jobs. Just be sure to do your research before signing up for any jobs online. Make sure they are legit and that the company is legit. Also, keep in mind with some of these businesses the income is not immediate.

Another way to bring in more cash is to reduce your expenses.  A classic way to do this is to refinance your debt. There are a number of reputable companies which might be able to help.  A lot of these are pretty new, but they might be worth your time.  Here is a short list.

Lending Tree – Is a loan “supermarket” type of exchange.  The business pretty much links up borrowers and lenders in a single platform.  Its bigger than most of the lenders out there and can offer loans for all needs and credit levels.

SoFi Loans – SoFi is a newer company, but they’ve been sucking up a lot of business due to having good rates and a low fee model.  These guys are definitely work checking out.

Many times we try to look for quick fixes or to “cheat” our way through paying debt off faster. Yes, you can pay off debt fast, but it will be hard grueling work and require a lot of sacrifices. Not only sacrifice from you but from your family as well. Once you get some momentum and get the debt pay off rolling it will all be worth the sacrifice once you can live free from the shackles of debt.

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What about you? What is the most radical thing you’ve done to pay off debt?

How Much Does It Really Cost to Be in a Wedding?

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Cost to be in a wedding

I was recently asked to be a bridesmaid in a friend’s wedding. I’ve never been asked before, so I was thrilled. She and I have become extremely close and I was honored. However, I didn’t realize how much it may cost to be in a wedding.

Debt-Free Living and Big Events

Sometimes I’ve found that our goal of being debt-free keeps us from doing things. Many of our friends and family don’t hesitate to swipe a credit card or take out a small loan for just about anything. (Seriously, one friend has $20,000 in credit card debt because traveling is more expensive than financial health).

Oftentimes, this means we turn down invites to go to larger events that may cost more money. We’ve turned down group trips and music festivals, which can run in the hundreds of dollars for a single ticket.

When my friend asked for me to be in her wedding though, I had months to get things ready and didn’t have to worry about swiping a credit card (because we aren’t doing that anymore).

How Much Does It Cost to be in a Wedding?

So far, the wedding will be costing me about $512. That isn’t including any additional money I’ll need during the bachelorette weekend for food, bar entry, etc. It also doesn’t include the wedding gift. When all is said and done, it will probably wind up costing me close to $800 to be a bridesmaid.

After doing some searching, that’s about the average cost for anyone to be a bridesmaid these days (seriously). Of course, I said yes before we had a TON of financial changes in our lives and pulling everything off has not been easy. If you’re thinking about being in a wedding and want to remain debt-free, consider these tips to keep cost low.

  • Be honest about your financial situation. If something is too expensive, speak up about it, but don’t be negative. Come forward with more affordable solutions.
  • Suggest the bridesmaids get different dresses in the same color. This can help you shave down the cost of your personal dress while still having uniformity.
  • Consider skipping out on the spa day and doing some of the beauty items DIY. Do your own hair and makeup. Skip the nail appointment and do them yourself. While it is fun, it isn’t necessary.
  • Stay in an Airbnb. If you’re traveling for the wedding or bachelorette party, stay in an Airbnb. You may even want to consider getting a group together to do so.

Lastly, don’t be afraid to say no. While the bride may be disappointed, if you can’t afford the cost of being a bridesmaid, it isn’t worth the stress you’ll put yourself (and the bride) through.

Readers, have you been part of the wedding party? How much did it cost you? How did you plan for it?

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What is the Best Debt Advice?

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debt advice

People are pretty much always willing to offer up advice, even when you haven’t asked for it. Throughout my debt freedom journey, I’ve received advice from a number of individuals, but how do you decipher what advice is good and what you should let go “in one ear and out the other?” Here’s how to determine if the debt advice you’re receiving is something to consider or not.

What is the Best Debt Advice?

So, there’s no best advice when it comes to paying off debt. Everyone’s finances are different, therefore, their approach will need to be different. However, there are certain pieces of debt advice that have consistently helped people.

  1. Make a budget and stick to it. Believe it or not, budgeting for repaying your debt makes it easier to stay on track. Not to mention, having a solid budget will keep you from overspending, which is what causes most people to go into debt in the first place.
  2. Avoid taking on any new/additional debt. If you have become accustomed to swiping your credit card for things, this can be difficult. Consider hiding it or even cutting it up. Additionally, you shouldn’t take out any loans to consolidate your debt. It will almost always prevent you from making significant progress towards your goal.
  3. Set realistic goals for yourself. Many people fail at making realistic goals when it comes to their finances. If you stretch yourself too thin, you’ll cave under stress. Be sure to budget money for fun things and set realistic time frames for debt and savings goals based on that.
  4. Contact your lenders if you’re having trouble paying. We’ve all had issues making payments at some point. The best thing you can do if you’re struggling to repay a lender is to give them a call. Most will work with you on repayment and some will even give you a break on late fees, etc.
  5. If you can’t pay cash, you can’t afford it. Cash is king. If you don’t have the money in the bank, or you haven’t budgeted for the purchase, you can’t afford it. It’s that simple.

While these five pieces of debt advice are solid, not everything everyone tells you is going to help you pay off your debt. Here are a few things to consider.

How to Determine What Advice is Good

Be wary of anyone telling you there’s a “cure-all” to your debt problem. No single approach is good for everyone. You’ll need to cater your debt freedom journey to your personal needs. It may be worth looking into certain approaches if what you are doing isn’t working, but what works for someone else won’t always necessarily work for you.

Additionally, don’t listen to anyone telling you that taking out more debt to consolidate or further your progress is a good idea. You will only be hindering your ultimate goal of being debt-free. Instead, consider ways you can cut spending or earn more to help pay off your debts.

The Best Piece of Advice I’ve Ever Received

Since starting my own debt-free journey, I’ve received all kinds of advice from several different people. Some individuals have suggested consolidation loans, others have said to use all of my savings to pay off my debt, and one person even told me that I didn’t have to pay certain debts off (seriously).

The best piece of debt advice I’ve ever received, however, was this: be patient with yourself. There is no roadmap to debt freedom. The journey looks different for everyone and we all have to feel our way through things. For us, we’ve had to learn to live on one income, hide the credit cards, and focus on living a cash-only lifestyle. That may not work for everyone, especially for families with children.

It is easy to get frustrated when you aren’t seeing progress and it is even easier to simply give up. Finding patience for your journey and yourself is key to becoming debt-free.

Readers, what is the best piece of debt advice you’ve ever received? 

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Planning for Unexpected Expenses

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planning for unexpected expenses

There is no doubt we’ve made strides in the right direction as far as our finances are concerned. However, there is still one area in which we are failing: planning for unexpected expenses.

This week I got the bridesmaid dress for an upcoming wedding in the mail (two weeks out from the wedding) and my worst nightmare occurred. It didn’t fit! It was far too late to return it for the correct size, so I decided to take it to a local alterations place. The total for the changes needed came out to $250.

The price definitely threw me for a loop and, because we aren’t using credit cards, it came directly out of savings. I was frustrated with myself for not planning ahead for alterations costs.

Why is Planning for Unexpected Expenses Important?

Planning for unexpected expenses is key to becoming debt-free. If we weren’t so devoted to not swiping our credit cards, I could have easily racked up another $250 in debt without batting an eye. The same is true for other expenses that may come your way out of the blue.

Failing to prepare for this is can lead to you hindering your debt progress. Not to mention, it can have an impact on your emergency savings and take away from paying off your debts. It can also put a dent in your emergency savings. Then you have to readjust your finances to refocus on padding your savings accounts once again instead of using the money for my debts.

How to Plan for Unexpected Expenses

Thankfully, there are things you can do to plan for the unexpected things in life. Here are a few tips to help you avoid the mistake I’ve made.

First, identify your unexpected expenses. Of course, we can’t always see into the future, but if there’s something that comes up with some regularity, you can try to plan ahead for it. For instance, property taxes, medical expenses, birthdays and holidays, and car repairs can all be planned for.

To identify other unexpected expenses, you can take a look at the past year’s bank and credit card statements. Note any irregular purchases and try to budget for that. You can add up the total of all the expenses and then divide it by 52 weeks. Set aside that amount every week moving forward. This can help you have the money set aside when something unexpected comes up.

Doing this will help you plan ahead and (unlike me) have the cash set aside when something may pop up. Do you have any additional tips you’d add? Leave them in the comments below!

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Why Does A Hard Credit Inquiry Affect Your Credit?

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If you are trying to better your credit score, most sources tell you to stay away from applying for new credit cards and loans. However, if you are building your credit from scratch or had no credit, you’ll need to apply for a line of credit.

The reason most advise against applying for new credit is that hard inquiries can actually hurt your score. But how and why does that happen?

What is a credit inquiry?

Before you find out how and why hard inquiries can impact your overall credit score, you should know what an inquiry is exactly. When you apply for any new line of credit, you give those lenders permission to acquire your credit report. Some companies may pull an inquiry about you without you asking, these will have no impact on your score. Your score only has the potential to be affected if you are asking for more credit. You can check your credit scores with CVS Ltd, or other similar services. 

Will your credit score change after applying for new credit?

Your credit score will go down a few points when you apply for a new line of credit. This is because your risk level goes up for lenders if you are actively looking for more available credit, especially if you apply for multiple sources of credit at one time. However, hard inquiries like auto loans, student loans or a mortgage will not impact your score much (if at all).

Lenders consider you to be a high risk if you apply to several lines of credit within a short period of time. For example, if you apply for five new credit cards in one week your score will likely lower due to the fact that you are seeking so many new lines of credit. A lender may see this and wonder why as well as wonder if you’ll be able to pay all your new inquiries back.

How much does a hard credit inquiry affect your credit score?

The impact on your individual credit score after applying for new credit will vary, depending on your own personal credit history. If you have very few accounts or a relatively short credit history, credit inquiries will have a more serious impact on your score.

Not all inquiries are treated the same either. For instance, if you are shopping around for a good mortgage rate, the inquiries will not impact your credit score while you are looking. It will count the inquiries made within the same time period as one inquiry instead of multiple (about 45 days time).

Improving Your Credit Score

<p>Knowing that making hard inquiries can have an impact on your credit score can make you want to avoid opening new credit lines. If you’d like to improve your credit a bit more before applying for new credit, here are a few things you can do:</p>::Pexels

Knowing that making hard inquiries can have an impact on your credit score can make you want to avoid opening new credit lines. If you’d like to improve your credit a bit more before applying for new credit, here are a few things you can do:

  1. Make sure you pay your bills on time. Looking at the graphic above, you can see that payment history makes up more than a third of your credit score.
  2. Keep the balances low on your current credit cards. Available credit is a key contributing factor when it comes to your credit score makeup.
  3. Open new accounts responsibly. Don’t take credit you don’t need and be sure to always pay your bill on time.
  4. Check your report regularly. You can use an app like Credit Karma to check up on your score weekly and be sure everything looks the way it should as well as track your progress.

Building and improving your credit can be extremely difficult if you aren’t 100% sure how different factors impact your credit score. Avoid making multiple hard inquiries on your credit within a short time period and, of course, stay on top of your finances by regularly monitoring your score.

Photos: airpix and CafeCredit.com

When Can You Be Taken To Court Over Debt?

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Taken to court over debt

Repaying your debt is stressful enough without having to deal with debt collectors and, even worse, lawyers. You may have heard horror stories of people being taken to court over debt. If you’re like me, you probably push those to the back of your mind. In some cases, those stories don’t even seem real. However, you can be taken to court over debt and millions of people have been.

Are You in Danger of Being Taken to Court Over Debt?

You can be taken to court over a number of different kinds of debt, including medical debt, auto loans, business debt, and even credit cards. The only debt you’re not likely to be taken to court for is a foreclosure. In most cases, the mortgage company is able to resell the property and you won’t be taken to court for that.

One of the best ways to stay on top of whether you are in danger of being taken to court or not is to open your mail. Believe it or not, many people just throw away mail that comes in. Sometimes people throw away important notices regarding debt. If you do that, you could land yourself in court to settle those debts.

What To Do

Finding out that you are in danger of being taken to court over debt is enough to send your anxiety through the roof. The first thing you should do after you find this information out is to contact some kind of legal aid. Some lawyers will offer you a discount or even a free consultation for your problem. In some cases, lawyers will provide their services for cases like these pro bono.

Next, be sure you do research on what the statute of limitations is on the debt you owe is. For different debts, the amount of time changes. It also varies from state to state. Additionally, your “time” can restart in some cases. You’ll want to be sure you’ve educated yourself about these limitations before getting too upset. It may turn out that you are no longer responsible for the debt (though you should never have that mindset).

Once you’ve done those two things, decide on how you wish to move forward. If you cannot pay the debt, you may be able to work out a settlement or payment arrangement within the court. Take a step back and assess what the best plan of action will be for you.

Readers, have you ever been taken to court over debt? How did you handle it?

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Use The 365 Day Money Challenge to Start Your Savings

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Just a few years ago it seemed like different challenges were popping up all over the internet. If you want to lose weight, there is an internet challenge for it. If you want to drink more water, there’s a challenge for that. Similarly, people who want to save money have internet challenges as well.

The first few money challenges that came out were designed to help people begin saving or add to their existing savings. One of the very first, the 365 Day Money Challenge, helps those who take the challenge save one penny at a time.

 

What is the 365 Day Money Challenge?

In short, the 365 Day Money Challenge is a fun way to save money. It was designed by internet users to help others save and create a community of people with similar financial goals. Like other money challenges, the 365 Day Money Challenge helps you save money by giving you a structure and set amount to save each day over a year (365 days).

How to Do The 365 Day Money Challenge

Every day you add more money to savings with the 365 Day Money Challenge. On the first day you save $0.01; day two, $0.02; day three, $0.03 and on the 365th day $3.65 (as illustrated in the photo below). After the year is over you’ll have saved $668.

<p>The 365 Day Money Challenge is a great way to add some additional cash to your savings or kickstart your savings. Many people have also used the money challenge to teach their children about saving. Either way, it is a fun way to go about saving. Click here for a downloadable version of the 365 Day Money Challenge.</p>::Pexels
The 365 Day Money Challenge is a great way to add some additional cash to your savings or kickstart your savings. Many people have also used the money challenge to teach their children about saving. Either way, it is a fun way to go about saving. Click here for a downloadable version of the 365 Day Money Challenge.

 

Other Money Challenges

If the 365 Day Money Challenge doesn’t appeal to you but you like the idea of a money challenge there are plenty of others to try as well. Below are some of the most popular challenges you can try:

  • 12 Week Money Challenge – Taking a money challenge for an entire year can seem a bit overwhelming. Scaling it down to 12 weeks can make it a bit more manageable. You can save $1,000 in just 12 weeks with this challenge.
  • 30 Day Money Challenge – An even shorter challenge is the 30 Day Money Challenge. The challenge lays out a structure that helps people save $500 in one month.
  • $5 Bill Challenge – The $5 bill challenge is a bit different. Instead of contributing money to savings every day, week or month you contribute every time you receive a $5 bill in change. Each time you do the $5 goes to savings.
  • 52 Week Money Challenge – The 52 Week Money Challenge is similar to the 365 Day Money Challenge. Both take a year. However, the 52 week challenge helps people save about $1,400 throughout the year.
  • Reverse 52 Week Money Challenge – The Reverse 52 Week Money Challenge is the same as the 62 Week Money Challenge but in reverse (as the name suggests). You start out saving $52 in week one and only $1 on week 52.
  • Bi-Weekly Money Challenge – Many people get paid bi-weekly so contributing to savings every other week works better for some people. This still takes a year and you’ll save $1,400 (like the 52 week challenges) but you can schedule it with your pay schedule (if you’re paid bi-weekly).
  • Money Challenge for Couples – Couples and finance can be rough. Trying a money challenge together can bring you closer together. There are many different challenges for couples to try, including daily, weekly and monthly saving structures.
  • Money Challenge for Kids – Teaching kids to save with a money challenge can be fun as well and you’ll be teaching them something they’ll use forever. There are multiple different challenges available for kids out there, most involve small amounts of money.
  • Money Challenge for College Students – A lot of college kids have to learn to save pretty quickly. Using a money challenge for college students can help them get a kickstart.

Whether you’re looking to start saving, add to your savings or save for a specific purchase trying a money challenge like the 365 Day Money Challenge can be great. Will you try one?

Photo: The Stingy Saver

What Do Brad Klontz’s ‘Money Scripts’ Say About You?

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<p>There is no doubt that money can cause some problems. Financial stress is something practically everyone deals with at some point in their lives but what do we know about how finance impacts your psychosis? How do people think about and act towards money and does it have an effect on their financial lives?</p>::Pexels
There is no doubt that money can cause some problems. Financial stress is something practically everyone deals with at some point in their lives but what do we know about how finance impacts your psychosis? How do people think about and act towards money and does it have an effect on their financial lives?

Dr. Brad Klontz believes so, which is why he came up with the “money scripts.” He hopes that these scripts will help individuals identify how they approach money and be able to better manage their finances.

What are the Money Scripts?

Klontz’s money scripts are broken down into four separate categories (avoidance, worship, status and vigilance). Each of these categories describes how a people thinks about money and, therefore, how they may act towards finance-related problems and topics. Here is a break down of each category in the money scripts:

  • Money avoidance – People that fit within this money script tend to think that money is bad. Those who fit the money avoidance category will also think that the rich are greedy and that they don’t deserve the money that they have.
  • Money worship – This money script refers to people who think that money can solve all of their problems. They also think that money can bring both power and happiness.
  • Money status – The money status script fits people who like to have the best and newest of everything. Having these nice things, to them, displays that they are wealthy (even if they bought it on credit).
  • Money vigilance – This is likely the least damaging of the money scripts. Those who fit into the money vigilance script place emphasis on saving and being frugal. They also make sure that no one knows how much money they make or have.

Knowing what the money scripts are won’t help you unless you know what they mean though. So, how can you use money scripts to your advantage?

If you’re interested in money scripts you may also enjoy: 

What the Money Scripts Can Teach You

Depending on what money script you identify with most you can determine what trouble you may have with money. Each money script poses a problem…

  • Money avoidance – Someone who fits into the money avoidance script, for instance, may not make as much money as someone else because they don’t think money is important. This can lead to some hard financial times though (especially if you don’t negotiate regular cost-of-living pay raises).
  • Money worship – Money worshippers will most likely have trouble with never having enough money. These people will likely be workaholics and find very little joy in spending time relaxing. Those who fit into this category will also likely have health issues like high blood pressure.
  • Money status – Those who fit into the money status script will likely have a lot of nice things but may struggle with debt. Money status people like nice things and tend to buy them (even when they don’t have the cash). This can cause huge financial trouble.
  • Money vigilance – Those who fit within the money vigilance script are more prone to relationship issues. People who are financially conscious can sometimes come off as cheap, which makes others not want to hang out that much.

If you look at the money scripts and find which you fit into you can better prepare yourself financially for the future. You can also notice when you are being financially destructive and prevent yourself from digging a hole.

No matter what money script you may fit into you can improve yourself financially. Check out these Three Radical Debt Reduction Steps.

What money script do you best identify with? Is it holding you back? For more information, check out the video below: 

Photo: Seer Interactive

The 5 Best Ways to Build Up Your Credit Score

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Your credit score has an impact on your life in more ways than ever before. Did you know that employers will often request a credit check prior to offering a job? Or a credit check is often required to rent a property? Your credit score has an impact far beyond your basic financial needs, so ensuring it’s in good shape should be a priority.

However, there’s no doubt that intending to fix your credit score is easier said than done. It can be complicated and take longer than you expect, but it is possible. Keep in mind these five points, and your credit score will be climbing in no time.

1) Check Your Credit File For Errors

In an ideal world, all of our financial history would be kept in perfect condition without any risk of errors — but this is the real world. There might be errors on your credit file that are damaging your overall score, such as debts that have been repaid still being listed as outstanding. Go through your entire credit report and history to ensure all information held about you is correct.

2) Use Credit To Improve Credit

Oddly enough, you have to use credit to improve it. Lenders want to see that you are responsible and can be trusted to pay bills on time. There are various methods for this, such as credit-building credit cards. However, these cards tend to have high interest rates, so look for another way of proving your financial trustworthiness. For example, of the best ways of establishing this history is with a smartphone contract; so long as you pay your bill, you’ll be able to enjoy mobile access to social media, the best Android casino fun, and improve your credit score — wins all round!

3) Don’t Close Unused Credit Accounts

If you have paid off a debt or no longer use a credit card, don’t close the account. Put it to the back of your mind and forget about it — but a credit reference agency will remember. Agencies like to see that you’re not maxing out all available lines of credit, so even if the account has been dormant for years, it will still go in your favour.

4) Don’t Apply For Credit Too Often

Yes, you need to use credit to build your credit, but that doesn’t mean you want to constantly be applying for credit. If you apply for too many different forms of credit, then it leaves a marker on your file — it can make you seem desperately in need of money. Lenders don’t like to extend credit to those who are desperate for cash, so you will be refused credit as a result of repeated applications. Only apply for credit once every three months to avoid this.

5) Pay Your Bills On Time

Your utility bills are another financial marker that can impact your credit score. Pay your bills on time, preferably by direct debit so you don’t forget. If you go into arrears, correct this as soon as you feasibly can — arrears on utilities accounts will go against you when it comes to your credit file.

Focus on the above five points and you can bring your credit score right up to where you want it to be.

 

Characteristics of Debt-Free People to Adopt

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<p>As a millennial, I feel I've grown up around people who would rather say "I wish I could do that" than work for what they want. I've heard plenty of people say they aspire to be wealthy or aspire to be debt free. Why keep on dreaming when you can make small changes in your life today?</p>::Pexels
As a millennial, I feel I’ve grown up around people who would rather say “I wish I could do that” than work for what they want. I’ve heard plenty of people say they aspire to be wealthy or aspire to be debt free. Why keep on dreaming when you can make small changes in your life today?

Generally it just takes a few consistent changes in your life to start working towards a goal, such as becoming debt free. This has been a goal of mine for quite some time and I’m always wondering if there is more I could be doing to ease my path to financial freedom.

Five Characteristics of Debt-Free People

When I started to think about it there was only one thing I needed to change in order to start working towards becoming debt free and living my life as a financially free adult. My attitude towards finance has been melancholy (something I truly couldn’t afford). So, I decided to identify some characteristics of people who are debt free.

They Are Goal-Driven

Most people who become debt free are goal-oriented. After all, paying off your debt and becoming financially free isn’t something you can do without having visible and manageable goals. If you want to become debt free you will have to establish goals for yourself and being goal-driven will help you obtain your debt free status.

Debt-Free People Are Frugal

A lot of people who don’t have any debt can come off as cheap or frugal. This is because they know that debt is not a tool. You don’t use money that you don’t have to pay for things you don’t need. You also wouldn’t pay full price for something when you can get it much cheaper elsewhere. Having this mentality keeps them debt free.

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People Who Are Debt Free Are Patient

Paying off debt takes a lot of time and patience, therefore, debt free people are usually very patient. Nothing with finance will happen overnight (unless you hit the lottery and even that takes time) This is one of the many characteristics that helped them become debt free in the first place so it is a great one to adopt for yourself.

Debt-Free People Are Not Materialistic

If your end goal is to be debt free you cannot place much value in materialistic things (unless you have the cash to pay for them). Many people go into tremendous amounts of debt because they want to have nice things. Instead of applying for store credit, buy the item(s) you can afford. Living lavishly won’t lead to financial freedom.

They Are Always Willing to Make Sacrifices

Lastly, people who have become debt free are always willing to make sacrifices. If they can’t afford to do something, they don’t do it. They will also likely turn down an outing if they have a small amount of debt to pay off so that they may be debt free again sooner.

Obviously not all of these are characteristics that can be adopted by everyone but if you attempt to be a little more frugal and pay close attention to your finances you may be able to become debt free some day too!