Tuesday, April 16, 2024

You’re Finally Out of Debt- What Next?

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(ThySistas.com) So you’ve finally paid off your last debt and have joined the ‘debt free club’- congratulations! It’s the most incredible feeling, many of us battle with debt for years of our lives and so once it’s paid off it’s like the shackles have been released. But where do you go from there, what do you do about your money going forward?

Work out where you went wrong last time

If you haven’t already, it’s worth sitting down and having a think about exactly what went wrong last time. How did you end up in a position where you got yourself into debt, and what could you do this time to prevent it? Maybe you ended up with lots of dental or medical bills where you didn’t have insurance. Perhaps you started off with store cards and got into the habit of buying things and it started to spiral. Maybe you had to escape a bad situation and rely on loans and credit cards where you had no money saved up. None of us know what’s around the next corner in life, being prepared with money can mean you’re ready to tackle any situation so learn from your mistakes.

Create a new budget

When you’re no longer paying debts off, you’ll have some money freed up within your budget and so creating a new one can be a smart idea. Find other areas where you can make cutbacks and savings too, and check that you’re not overspending or being overcharged anywhere. Using a price comparison site once a year to get yourself onto the best tariffs with your utility bills can save you money over the year, and things like your grocery budget can often easily be cut back if it’s starting to get out of control. 

Create new streams of income

You could start a home based business, you could freelance, write a blog or trade cryptocurrency CFDs. Whatever it is that interests you, look for ways you can monetise and set up an extra stream of income along with your regular job.

Start saving

When you’re spending less and making more, saving becomes easy. If you save up the money that you would have previously spent on debt, along with any extra money you make, your savings account will quickly grow. Having money in the bank acts as a buffer and if an undesirable situation crops up in life, you have the ability to sort it without falling back into debt. Having longer and shorter term savings accounts can be useful too, longer term could be saving for a mortgage or other large goals or just be an account you dont touch unless it’s an emergency. Shorter term savings can enable you to buy luxuries like new tech, holidays and a car without having to use loans or finance. 

Staff Writer; Shelia Carter

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