REASONS PEOPLE INCUR DEBT AND HOW TO BE DEBT FREE
Hey lovelies ❤️
It's your favorite girl @debbie-ese 😍
Welcome to my blog 🤗
source
It is very easy to incur debt but to do without it is not easy as high costs of goods and services continue to increase day by day in our world. There are people who have big dreams such as going to the University, starting a business, building a house, buying a car and so on but do not have the financial capacity to do them. In most cases people apply for loan or borrow money from friends or family to fix these needs in their life. Therefore, a person is in debt when he or she is owing another person some amount of money - either big or small - which was used for any purpose. In other words, a person is in debt when his expenses is more than the amount of money that is available at his disposal and he or she had to borrow from either an individual or a financial institution to make the payment.
The question of "Why do people incur debt?" may look like it has an easy answer such as "People incur debt because they spend beyond their means" but it is not always the case - life is more complicated than that. The reason why people fall into debt is mostly because they spend more than they earn but in most cases it is not always their fault. For instance, there are some unexpected situations that happen in life that demand you breaking into your savings, taking a loan and so on such as emergency medical bills, repair of your car, fixing your apartment after a serious rainfall, and so on. In fact, a person who lost his or her job would have to survive as he tries to get back on his feet and this can be achieved by taking loans from friends and family.
source
However, living a life of debt is not the best and it can lock you up in financial captivity for a long time unless you do the right things. In a bid to gain your financial freedom from debt and live a debt free life you must master the art of budgeting, creating emergency fund, repaying your debt and living within your means. To be sincere, it is going to take some time and dedication to gain your financial freedom but in the end it is worth it.
- Budgeting: Budget is key to reducing debt. It makes you understand how you spend your money and what you spend it on. If you want to be debt free, try to create a budget and be dedicated to stick to it. It is quite normal to be tempted to spend more money when there is more inflow and this is the easiest way to incur mountain of debts. There are times when you buy the things that you do not need just because you have more money with you. But with a working budget you'd not want to spend what you have not planned for.
- Creating emergency fund: This is very important so that you don't incur further debts in the nearest future. Setting aside little funds every month can add up to become a lot to come to your rescue when you are in dire need.
source - Repaying your debt: Make moves to repay off your debt as fast as you can to avoid increase in interest and to also give you the feeling of being a free man among others.
- Live within your means: Don't spend your money on the things you do not need and avoid taking loans for things that do not worth it.
Follow these tips and begin your journey to be debt free.
Thank you for your time lovelies.
The post is originally written by me 💕@debbie-ese💕
