There are a variety of reasons why a person often falls under the burden of overwhelming debts. Out of all, these are the most important causes of falling in debts.
1. One important reason for you to go in debt is when you don’t take care of your daily expenses, the more you spend the little is left for savings and the income decreases because of your expenses.
2. A Monthly spending plan is essential. This will help you to learn where you are spending the money, you should always write down your expanses which will help you to tally with your income. Many a times we spend money unnecessarily writing down will cut down your expenses and help you from any kind of debt. This will also make you feel powerful because you would know where to spend and where not to.
3. Getting married more than once is also one big reason to go in debt, because with new spouse there is always a party, shopping, and honeymoon these are the most expensive things which comes with new wedding which can be breathtaking for your debt cause.
4. Gambling is one of America’s newly born entertainment. Either way you exchange money from home to casino that can also be an addiction which can lead you to your greatest downfall. People at times go to extreme end where they are intoxicated and ready to mortgage their house which can be ridiculous for the family.
5. Well there are other reason like gaps in coverage, lapsed policies this all adds to the debt that you may be in. One of the reasons is also the medical expenses with lapsed policies that means more debt for you. Now days every doctor takes credit card is it convenient? Please think.
6. The simplest way to save you from debt is having savings, Savings of six to seven months of living will always give you a cushion of joy, like in emergency of a job lay off, divorce or illness is not going to cause you an immediate financial strain and increase debt.
7. Shifting jobs from one place to another could be a pain, if you think down the road if you increase your income due to more hours, a second job, or a better job, then is the time to start adding in some of the previous spending before you became underemployed.
8. Always discuss your financial goals with your spouse. If you are married to a spender and you are the saver then it becomes very important to strategies the budget and you should always be aware of yours spouses account, many times you find out that your spouse has used thousands of dollar in credit card which you are not aware of, it can also lead to debt.
9. Never ever spend the money until and unless your check is cleared. Spending tomorrow’s money today is very tempting. This is called banking on a windfall. The things that you may believe will come your way might be very hurting when it does not come your way. The simple philosophy is don’t spend the money until the check clears.
10. Get financially educated because financial mistakes are very expensive and complicated to resolve. This can also be a biggest reason for you to get in a debt.
This entry was posted on Friday, May 6th, 2011 at 3:47 pm and is filed under Debt. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.