Planning for the Future by Avoiding Debt
There are many things that you can do to avoid debt. Avoiding debt will help you plan for the future and
protect your family better.
One of the crucial keys to fully protecting your family from the impact of negative occurrences and
situations is avoiding debt. Debt has quickly destroyed marriages because of the financial issues
Unfortunately, it is a growing problem as finances are not
the top reason that people file for divorce in the United
States today. There are many things that you should make
sure you do in order to avoid debt and protect your family
against unforeseen circumstances.
The first thing you should never do is lie to your significant
other about your spending habits. He or she will find out
what you have done eventually and it will not make matters better for the time being.
In fact, it will make them much worse later. Not only can you not begin taking care of the problem
immediately, but you damage your relationship which is dependent on trust with the other person.
It is better to face what you did wrong together so that it can be taken care of appropriately and
immediately. Never do anything that will damage the high level of trust that your significant other has
This is one of the worst things that you could do. Even though it may seem like less damage will be dealt
by hiding your mistakes, the opposite is actually true.
They Never Said it Would Be Easy
The second thing you will want to do is avoid taking out
student loans whenever possible. This is not always
possible, but you should be sure that you are going into
something that pays well and which has good job
opportunities before you take out loans.
You will want your loans to be appropriate in proportion to
the job you are going to be able to receive after college at
most. However, it is better to get a second job, work hard,
and avoid loans when you can.
It is also important to be aware that defaulting on a student loan can cost you a lot of money. Make sure
you know how much you are responsible for paying back and when if you do take out some loans.
When the bank allows, try to avoid having your parents co-sign your loans. This will help ensure that you
do not take them down with you if circumstances suddenly make it impossible for you to make your
There are many Types of Transportation
The third thing you will want to do is avoid purchasing a car that you cannot afford. You should never
drive a car on which you owe more than it is worth.
You do not need a fancy car to travel to work, the grocery store, or other locations. Most likely, you only
need something that will get you to these places and which will not make a significant impression on
If you can make a significant down payment, a new car may be worth it because you will not owe more
than the car is worth once you leave the parking lot. You should never settle for a car if you cannot put
down a significant down payment, if you can barely afford the monthly payments, or if the car is worth
less than the amount you will owe.
Build it, Don’t Mess it up
The fourth thing you will want to do is use credit wisely. Credit cards should be used to build up good
credit and they should be paid off in full every month.
Sometimes you will need to use it to purchase a house or a car. When it is necessary to buy a large item
on credit, you will want to make sure that you have obtained a reasonable interest rate.
High interest rates will bring you to significant amounts of debt very quickly. Instead of accepting these
rates, take the time to fix your credit score so that you can earn a better interest rate.
It will definitely be worth the wait in the end. The fifth thing you should never do is put your home or
your retirement fund at risk.
These things are commonly used to help back up a loan. However, if you cannot afford to make the
payments on the loan, these things could be seized by the bank.
This could make your standard of living significantly lower in the future. Do not take this risk.
As you do these things and avoid debt, you will be prepared to make the payments that come to you
month by month. Do not forget to plan for tax season as you can also fall behind on your tax payments.
This is another type of debt that you will also have to pay back. You will want to make sure that you do
not fall behind on your taxes. If you are from California like I am, the last thing you want to do is get hit
with a tax levy in California or a wage levy in California. Its tough enough dealing with debt, don’t make
it harder for you.
Photo Credit: Vanz, Oxfordian World