How to Live Within Your Means to Stay Debt Free

Debt reduction is a long drawn and effort intensive process. With several thousand Americans struggling with massive debt, the realization that it is best not to fall into the debt trap, has perhaps come a bit late. Often, huge debts are incurred because you do not have enough savings to meet unexpected expenses such as medical emergencies.

At other times, overspending using credit cards or on loans is the cause of excessive debt. When you control and structure your spending so that every dollar is spent on worthwhile expenses, it is easier to avoid incurring such debts. Here are some ideas that you can use to live life within your means and still enjoy it.

Keep track of your spending

One of the biggest mistakes that debt ridden people made is that they never realize their spending far exceeded what they were earning by way of salary, income from investments etc. Make a simple income expense sheet to tell you exactly how much money is coming in each month and how much you are spending.

This monthly statement helps you take stock of your finances and spending habits. If your spending is way beyond your income then chances are you are already well on your way to accumulating unmanageable debts.
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