Getting back on track or staying on the right path to lower debt can be derailed quickly by the need for quick money and personal wants. The temptation to apply for loans and credit cards that offer access to easy cash is often too great for many to ignore. The problem is they are probably not as great as they appear to be. The one thing you can be guaranteed is that they will only serve to get you further into debt. Here are some things you can do to avoid the temptation of loans and credit card offers.
Make a Budget You Can Stick To
The best way to avoid temptation, when it comes to obtaining loans and credit offers is to draw up a financial blueprint and stick with it. Exercise strong fiscal self-control and plan on not spending money unless it is part of the budget. This doesn't include emergency repairs or health costs, but all unnecessary spending. You will soon make this an everyday practice that comes naturally. You won't even think twice about accumulating bad debt.
Hunt Down the Deals
Make it a game to find the best deals you can on the things you plan to buy. Find sources of good quality used items, discount outlets, in-store specials and all types of money saving venues. Barter and trade for high ticket items. The less you feel deprived of material things, the less you'll be tempted to get more credit and loans to buy things. Avoid taking out merchant lines of credit. The interest can be higher and you can usually find the things you want of similar value a lot less for cash.
Only Get Loans from Family
When you absolutely need to take out a small loan to get from one pay date to the next, take one out with family or friends. For one, it's harder to ask for the loan. Most people are hesitant to ask family for money unless they really need it. It keeps your loan requests down to important needs only. Most family members won't charge you interest, so you save money right there. You won't lose any collateral if you run into problems coming up with all of the money at one time for repayment. They may not be happy about it, but they won't repossess your car.
Some people just won’t borrow from family or friends as many serious disputes can arise. If you find yourself in a bind and do need cash, don’t just take the first line of credit that is offered to you. Take the time to research available loan options. There are non-profits that provide zero or low interest loans for those who needing emergency funds.
Have a Savings Plan
One reason many people are tempted to take out a loan or get an added credit card is the lack of cash savings. It's never a good idea to replace a true savings plan with lines of credit or loans. You need to have money earning interest for you, not the other way around. Plan to save as close to 10 percent of your salary as possible. If your bills don't allow for it, find other ways to come up with extra cash for savings. Sell old items you no longer need or pick up a small second job. Put all of that money into savings.
Remove yourself from Credit Lists
Most credit reporting agencies maintain lists of people that are eligible for pre-approved credit. Request to be removed from any and all of these lists. You won't have pre-approved credit cards floating around this way. It will limit what credit offer mail you get that simply adds temptation. Make a habit of throwing credit card and loan offers in the trash if you already have the ones you need. You can't be tempted by what you don't read.
When you find yourself in need of money, think carefully before borrowing from any source. By only getting loans when they are absolutely necessary, you save yourself the stress of repayments. By saving 10% of your income, you can borrow from yourself. It’s always easier to pay yourself, than to pay back family or the high interest rates of your creditors.
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