Break The Dependence Cycle – Paycheck to Paycheck

Do not spend frivolously. Overspending can increase debt and lead to financial ruin.  It is easy to put something you want on a credit card or debit card, but even on a debit card you have to be able to pay back what you borrowed.

You may want to have at least 2-3  bank accounts.  One for your monthly bills ( such as phone, cable, rent, IRA contribution, food, mortgage, water, gas & electric etc. The second one is for savings and emergencies.  You need to have at least 3-6 months of income saved just in case.  This is extremely important.  No one knows what will happen in the future so prepare now.  The third one is for everything else such as:  down payment for a house or condo, building mutual funds or the stock market.  It is up to you what you want to accomplish with your money.

You can even use the third bank account to save for large debts.  You should always have a plan and be able to work that plan.  If you cannot sleep because you have creditors hounding you then this is the time to do something about it and get rid of them for good. (Also read, The Dangers of Getting Payday Loans & How To Save)  See how much interest you are paying on your cards.  Some cards are 30% or more and this interest can keep you in debt for like 25-30 years.  Imagine that! You may not believe it but, it’s true.  Do not pay only the minimum.  Pay more than the minimum if possible and don’t be late with your payments.  Do not keep using it. Hide it or ask someone to hide it for you.  Out of sight out of mind.  Paying only the minimum does not even put a dent into the balance and when they add interest and other charges what you paid is literally nothing.