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Being debt-free is a lifestyle choice that you can make. All it takes is a little persistence to tweak your current habits. It’s absolutely important to be mindful of where your hard-earned money goes and to save a portion of it no matter how small because it’s the habit that matters, not the amount. Here are 7 great financial habits you should practice to live a debt-free life.
Always Save a Portion of Your Earnings
Make it a habit to always save a portion of your earnings. It’s not a matter of how much you save, but that you do it consistently no matter how small. If money is tight for you, even $1 a day will go a very long way towards cultivating this crucial habit.
Set Goals
Writing and setting goals is key to your success! Setting goals allows you to take a moment to think about what you want to achieve and the steps you’ll need to take to get there.
Track and Analyze Your Spending Regularly
A good habit to practice to be debt-free is to always incorporate a budget into your personal finance plans while tracking your spending. Budgeting allows you to analyze your spending so that you can be more aware of where your spending habits may be costing you.
For instance, before you make your budget each month, look over your personal and work calendar to see if there are any trips, birthdays, holidays, or anniversaries that you need to include in your budget. Also, set aside spending money for yourself. You can spend money on what you want when you’re on a budget, you just have to plan for it.
Live Within Your Means
Living within your means can be defined as not spending more than what you make. While this seems simple enough, it can be difficult to control due to the wealth of credit options we have today in our society.
Think Long-term
Building wealth is a marathon, not a sprint. It takes time to build your credit score and grow your savings. So when you save that extra $3 dollars for the cake you didn’t buy today, it goes towards your bigger goals. Planning for the long haul will help you control your spending and make better purchasing decisions.
Teach Your Kids About Money
Children need to know that money is not handed to them, but it is earned for hard work and effort. One of many things you may want to also teach them is how to be responsible with money. It is a good thing if children your children have a strong foundation in money before they turn 18.
Practice Delayed Gratification
Success in nearly every field requires you to ignore doing something easier (delaying gratification) in favor of doing something harder. When you’re faced with a choice to spend on something, ask yourself if you can wait it out for a greater reward in the future. Take for instance, if you delay the gratification of getting the latest iPhone today that everyone is raving about, it would have a tremendous effect on your savings over time.
The bottom line is that being debt-free is a liberating feeling and is certainly achievable wherever you are now in your financial journey. All it takes is the willingness to slowly and patiently implement a few everyday habits into your decision making.
Good luck!!
