What’s Your Plan For Staying Out Of Debt?

If you’re in the process of paying off your credit card debt, whether it be through a debt management service, refinance, or debt stacking, what’s your strategy for staying out of debt?

“Strategy for staying out? What’s that?”, you may be asking.

If you pay off all your credit card debt and then you come across another emergency – the refrigerator breaks down, your car needs new tires, a health challenge, etc., what’s going to prevent you from racking up all those credit cards again?

Most people don’t think about this and then wonder why they get themselves back into debt all over again. You need to take this part of your financial game planning seriously.

There’s two things you need to do to prevent yourself from getting back into debt. First, ask yourself if you’re really dedicated to staying debt-free. If not, I can’t help you and neither can anyone else. If staying debt-free isn’t a driving force within you, you’ll be pulling out the credit cards to purchase things you really can’t afford just like before.

Now, if you find that you’re dedicated to this way of life, the next thing you need to get committed to is to build yourself an emergency fund of cash. Yes, cash!

Just think if you had $5,000, $10,000, $15,000, etc. sitting aside in a money market account just waiting for one of those emergencies. The car breaks down and instead of having to turn to Uncle Visa, you can turn to your cash.

You pay for the car repair and don’t owe any payments or interest. If you stay devoted to adding to your emergency fund each month, you’ve made yourself the recipient of those monthly payments instead of your old friend, MasterCard, who would love to drain your checking account just like in the past.

Don’t let them back into your life! Get serious about adding to your emergency fund each month until it reaches an amount you feel comfortable with. Or, better yet, just make it a regular monthly “bill” for the rest of your life. That way, when you do need to deplete it a bit when “life” happens, you’ll be used to building it back up again.

If you’re going through the headache of debt elimination right now, do yourself a favor and build a “staying out of debt” plan into your future.