Musings of a Museum Fanatic: Ways to Stay Out of Debt

4.17.2020

Ways to Stay Out of Debt

Now that Kevin and I have paid off our debt it's top of our list to make sure we stay out of debt! We've already wandered back into debt once and we're not going to do that again. Staying out of debt will allow us to do things like travel and improve our home that we wouldn't be able to do while we had debt.

I think staying out of debt might be a much harder process than getting out. It's like maintaining a weight loss. So I've come up with a few ways I think will help keep us and you out of debt.



Stop creating more debt
This seems really obvious but I think sometimes the most obvious things need to be said. Kevin and I have talked in detail about our mistakes that we made with going into debt for our cars. We discussed what we need to do in the future when it comes time to purchase new cars and what we will do to actively avoid taking out debt on them.

What are some ways that you actively avoid going into more debt?

Keep a detailed budget
For years we talked about actually budgeting and then at the start of our journey last year it just clicked. We started using EveryDollar Budget and it's been great. We make sure every dollar has a job each month.

Keeping a detailed budget every month will focus you and your finances. It will help when big purchases are on the horizon. You'll be able to budget and save for them instead of taking out more debt to purchase whatever it is.

Build an Emergency Fund
Stuff happens. Life happens. Sometimes it costs us money. Having an emergency fund will help when those life moments come up. I'm not talking about oh I want a new pair of shoes and I didn't budget for it. I'm talking about I ran over a bed of nails and all my tires blew out. Now I need to spend money and replace all my tires. An actual emergency.

Cut up your credit cards
I will admit this is something that I've had an issue with when it came to Dave Ramsey's baby steps. Kevin and I never take out a balance on our cards. We pay them off every month and don't put anything more on them than we have budgeted. While we haven't closed all of them we are closing most of them. 

I know that there are a lot of people who aren't able to be disciplined with their cards. That is how they end up in credit card debt. If you're one of those people cutting up your cards is the best solution. It keeps away the temptation of it. You only spend what you have in your account.

Keep learning about finances
Continuously learning about any type of subject will allow you to understand it better and become an expert. This is no different when it comes to your finances. Before last spring we knew we had to budget and do better but didn't know exactly what we should be doing. Well that's where resources like Financial Peace University, Total Money Makeover, The Millionaire Next Door and every financial article that popped up in my news feed came in.

I've been reading everything financial that comes across my plate. At this point I'm definitely not an expert but I sure know way more about finances and paying off debt than I did last year. Next year I'll know even more than I do know. We should always been learning and improving ourselves in every area. It can only benefit us!

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