5. Plan your purchases
Save cash upfront for major purchases like that new TV or trip to Disney World.
That doesn’t mean you have to carry thousands in cash around in your wallet. Open a high-yield savings account for your anticipated purchases — not just for big-ticket items but also for big-expense times like Christmas and back-to-school shopping.
If you want to use credit cards to pay for the purchases and capture rewards they may offer, go ahead. But only do so if you have saved the money to pay off the splurge quickly. That will help keep your monthly bills down, your debt-to-income ratio at a reasonable level and your credit score up.
6. Adjust your spending
Life happens. That’s why you should be prepared with enough savings to pay living expenses for at least six months. Even with an emergency fund, you’ll probably need to cut back on spending if you get divorced, lose a job, or take unpaid leave to care for your spouse or parents.
Discuss the changing situation with your family to get support for spending adjustments. Even small purchases add up. Can you cut your cellphone plan, curtail your cable bill or forgo daily pumpkin spice lattes?
When grocery shopping, clip coupons or find them online or through apps like Coupons.com. Make a shopping list and stick to it.
7. Boost your income
Whether it’s a one-time windfall or income from a steady side gig, use extra money to pay down debt or boost savings so you don’t run up more debt.
Technology makes it easier than ever to make money on the side. Whether it’s starting a dog-sitting service, selling goods online or taking a part-time job with work-from-home opportunities, there are hundreds of ways to generate extra cash legitimately.
For more, check out “50 Ways to Make a Fast $50 (or Lots More!)”
Dealing with debt is no fun. But we’ve partnered with nonprofit credit counselors who want to help and will do it free.
All you have to do to reach one is call 888-739-9616. If a call now isn’t convenient, fill out the form below and they’ll get back to you whenever you tell them to.
How do you stay out of debt? Let us know in comments below or on our Facebook page.
Disclosure: The information you read here is always objective. However, we sometimes receive compensation when you click links within our stories.