HOW TO AVOID DEBT

Today’s economy has been a wakeup call. The consequences of unemployment, rising prices, rampant credit card debt and stress seem insurmountable.

What could we have done in the past that would have prepared and protected us?

Going back: We were told it was ‘the American Way’ to buy whatever we wanted, whether we had the money or not. We did. We got into debt and still bought more. Now we see that spending philosophy has not worked for us. We need to begin a ‘new American Way’, one that will get us out of debt and begin saving money.

Where we used to have fun spending every dollar before the next paycheck and then some, now we have fun seeing how much we can have leftover to save before the next paycheck.

The first thing we need to do is live, not within our means, but below our means. Living on the cheap not only can be fun, but stimulating. Make it a daily routine, like living in survival mode. Then think of new ways to save, have family contests. The prizes are seeing savings grow and having financial stability!

Some things we can do to boost savings:

· Eat healthy and exercise, therefore, staying healthier and cutting back on medical bills.

· In reality mode, think if the upcoming purchase is a want or a need.

· Think of ways to do it cheaper or free.

· Before buying anything, think of upcoming big expenses.

· Develop a new positive attitude that will make your will to save stronger than your will to spend.

· Opt to get an extra job to boost savings, increase 401K’s, or to save for college or a dream vacation.

Where we used to go into savings for a myriad of reasons, now we don’t need to. We have enough in the checking account to pay for emergencies, all our bills and have money to save.

We stay in survival mode until we save an eight-month salary nest egg. Afterwards, we still need to be diligent every day. It all depends on how secure we wish to be, as to how much we relax our spending habits. If we continue to save in survival mode, there will be funds to replace a vehicle or a freezer, buy a travel trailer or pay for a root canal and crown, with cash, thereby, not paying interest. It’s up to each person to decide what is more important. Those who save more will have a more secure future.

So, the ‘new American Way’ will consist of spending more prudently and buying less. Businesses will be presented with new challenges to offer more cost effective choices of ‘needs’ inventory versus the ‘wants’ inventory of the past. Everyone comes out a winner.

Living below our means is like buying an insurance policy against debt and financial disaster.

Judy Guralchuk, author of A Life Preserver in a Sea of Debt, available at Border’s, Bad Rock Book Store, Sliter’s Hardware, amazon, and Barnes & noble