Get Out of Debt Part 8: Preventing Debt Issues

This is the last installment in the series of getting out of debt. There are plenty of steps you can take to ensure you are getting and staying out of debt, but these have been some the highest level items. In this segment, let’s discuss the importance of preventing the scenarios which got you and so many others in the debt situation. All the guides and steps to get out of debt will do you no good, if you are not actively working to prevent and guard your finances from future issues.

Savings

Ideally your savings accounts would have already been set up during the different steps through the debt process. As early on in the debt payoff process as possible, it is best to save $1000. This will be your emergency fund to act as a safeguard through the rest of the steps. In the event something comes up in life during your strife to pay off debt, this $1000 can be used to pay for such items (new tire, medical issues, flood, etc). The other savings would be for 6-9 months of bills and expenses. Again, this is to be set in place for a scenario of losing your job and trying to find another. Both of these scenario savings accounts are crucial. Without them, many are likely to turn to loans and credit cards to help them make ends meet during a hard time.

The Social Lie

So many of us are easily influenced by social media and comparing ourselves to others. Once you are debt free, it may feel like you can “afford” to take on a little debt for personal desires. Most of the time this is driven by the need to appear better than we are. This is such a slippery slope, and can quickly lead to falling back into more debt. You need to learn to self reflect and be happy with the things you have. Without it, you will be tempted to make poor decisions with your finances which will only lead you to the debt cycle again.

Debt is a pain most of us will have to deal with at some point in our lives. It does not have to be a crutch we have to deal with all of our lives though. You have the choice to make a difference today. It all starts with a mind shift and a willingness to make the change from being in debt to wanting to be out of debt. Make the right decision!