Tip on how to avoid debt.

[TacitBlue]

I've never been able to get a credit card or a loan with which to build credit. The reason? I have no credit! Gee if I only had some credit, then I could get some credit. That's like if your boss told you that he won't pay you until you have enough money. I find the whole credit thing to be the most frustrating thing on the planet. Fortunately, they will give a student loan to anyone, so I've got that going for me. It will eventually be payed off and actually do something for my credit.

[JBaymore]

Simple..........

Live Within Your Means.

best,

..................john

[Dr.bob7]

There was a skit on saturday night live,


I have a fullproof way to stay out of debt.

I call it dont buy stuff you cant afford

[Brett_Henderson]

I still prefer a credit card to a debit card for the reason I mentioned.

If something goes wrong, it's having REAL money tied up, or having a line of credit tied up.. Even if it's a bank or retailer's mistake.... real money taken out of a bank account is a bigger problem than having your credit limit temporarily locked.

[Katahu]

Paying one debt, by adding to another, is the fiscal sin above all others. True, it's better than being late with the car payment (barely).. but sets a standard for financial ruin. Call the bank and let them know you'll be late... take the late fee on the chin and it does not get reported as a "past 30" on your credit report. Adding several hundred dollars to a balance that's charged nearly 20% is bad enough by itself.. but breaking that mental barrier of paying one bill by charging it to a credit card is just insane. If it's totally unavoidable (like you'll not have enough money in time to avoid being REALLY late..then just learn from it.. (and never do it again)

Hmm, thank you for pointing out my fault there. I'll make sure that I won't commit that mistake. Thankfully, that mistake hasn't happened to me yet. In which case, I'll make certain that my income is always higher than my expenses.

[Chris_F]

The root issue I think is people confusing cash management with wealth management.

[expat]

The root issue I think is people confusing cash management with wealth management.  Just because you can finance a purchase and maintain positive (or neutral) cash management doesn't mean that the purchase is wise from a wealth management perspective.  And ultimately wealth is much more important than cash.

The other thing is, what ever you are buying, is it a "want" or a "need". If it is a "want", save the cash and then buy it. It is the "wants" that c#ck up finances because you use your cash on what you "need" and then fool yourself that you deserve a treat or have worked really hard just lately and then buy that nice "want".

Matt  

[Katahu]

The root issue I think is people confusing cash management with wealth management.  Just because you can finance a purchase and maintain positive (or neutral) cash management doesn't mean that the purchase is wise from a wealth management perspective.  And ultimately wealth is much more important than cash.

The other thing is, what ever you are buying, is it a "want" or a "need". If it is a "want", save the cash and then buy it. It is the "wants" that c#ck up finances because you use your cash on what you "need" and then fool yourself that you deserve a treat or have worked really hard just lately and then buy that nice "want".

Matt  

Or as Sigmon Freud always said: "Your Libido is your sudden urge, you ego is the one that feeds that urge, and the super ego what controls your urge".

Basically, if your ego is bigger than your super ego, you're financially screwed.

[Apex]

Good stuff here guys.  

I've only got two credit cards, easy to keep track of, and no special cards like gas or dept stores, you can use your regular credit cards for all that, and I don't use debit cards for reasons already mentioned here.  Some monthly expenses like phone and electric are drawn from my credit cards for convenience.  My paper checks take care of all the rest.

[Saitek]

I don't like them. I used one once for some shop and I just didn't like the debt there. I like my debit card and use it everywhere.  

My ways of trying to stay out of debt is to work hard when I can. I have decided not to own a car, (although I have learnt how to drive) as the insurance, tax, fuel (buying a car actually isn't the problem) is just too much. If I lived in the US I'd probably get one at once, but in the UK with publiv transport everywhere it would be just a luxury I don't need. I try to be careful with food and electricity to keep the bills down. I only heat my bedroom for example when I'm in it and the rest of the flat stays cold.