5 Important Tips for Keeping Household Debt Under Control from a new youPersonal and household debt can strain relationships and make life both difficult and stressful. Everything these days is so expensive that sometimes it can seem impossible to keep your finances under control, but there are ways that you can proactively manage your money to prevent household debt from accumulating. Here are five major—and simple—things that you can do to keep your household debt under control.  

1.  Organize Your Finances With a Budget

One of the best things about a budget is that it can tell you exactly how much money you have coming in and going out, meaning you won’t be caught off-guard by crushing household debt. Create a list of all your monthly expenses, all the money you have coming in each month, and then look back through a few bank statements to see where any additional money is going.

Budget enough money every month to cover bills and living expenses, and make sure you also set some aside regularly for savings and emergency funds. Use the bank statements to figure out where you can tighten the belt if necessary.

2. Don’t Spend Money on Things You Don’t Need

This is where your budget will come in handy: while you’re looking through your bank statements from the past few months, highlight all the frivolous or unnecessary expenses that you could cut out to save money. Are you shopping for new clothes or household items on a regular basis when you don’t need to?

Do you spend more money than you should on meals and entertainment? Perhaps you’re doubling up on certain things, like having multiple video streaming service subscriptions or having a cell phone and a landline when you can do with one or the other. Moreover, keep an eye out for money you spend on things you don’t use, such as newspaper subscriptions, gym memberships, or even phone services like call display.

3. Avoid Having Too Much Credit

Credit cards are handy, and they can actually save your skin in an emergency, but having too much credit available can be an invitation for debt and disaster. Even if you have a strict budget, sometimes the temptation of a credit card can be too much, and before long you could find yourself facing huge bills that you can’t pay.

The Consumer Financial Protection Bureau recommends not using more than 30 percent of the credit available to you. Also, try to avoid making purchases if you can’t pay off the balance at the end of the month, and at the very least you must pay more than the minimum payment on every bill.

4. Find Ways to Save Money

Along with cutting out luxury expenses and payments for things you don’t need or use, you should also actively look for ways to save money in your daily life. This means finding things that are on sale, using thrift stores instead of buying new, borrowing books and DVDs from the library instead of buying them, and making things instead of purchasing them. Also, every year that you get money back on your taxes, deposit that money right into a high-interest savings account instead of spending it.

5. Don’t Default on Payments

If you’re the type of family that’s often late with payments, you can save big bucks by paying your bills on time and avoiding additional interest payments, late fees, and maybe even over-limit fees. Not only will this save you money, but it will also improve your credit score. If you don’t pay bills on time because you’re forgetful, set up automatic withdrawals to avoid missing any more payments.

Life is expensive, especially when you have things like bills, kids, mortgage payments, and other necessities to pay for. Luckily, there are ways you can control your household debt and stop the cycle of debt from ever starting. One of the most important things you can do is create a budget because this will ensure you have enough money coming in to cover your bills, and make sure that you’ve also got money put aside for the future and rainy days.

Find help and get debt relief today by contacting us to get a free quote on a debt relief program.