10 Easy Actionable Tips to Live a Debt-Free Life

Wave Goodbye to Financial Stress and Say Hello to a Debt-Free Reality

The journey to a debt-free life is like setting sail towards financial freedom and peace of mind. Picture this: no more sleepless nights fretting over bills, no more tightrope walks between paychecks. Instead, envision a life where your money works for you, not against you. In this blog, we're unwrapping 10 actionable tips that will not only steer you clear of debt but also help you reclaim control over your finances. Get ready to wave goodbye to financial stress and say hello to a debt-free reality with these game-changing strategies. 

1. Have set goals

Having a plan is like having a roadmap for your money. According to Yoni Dayan, the editor in Chief at Money Under 30, folks who are rocking it in the money department usually have clear money goals and are doing stuff to make them happen. He says, "If you have a good why to save, the how will come much more naturally.” Feeling a bit lost on where to kick things off? 

2. Delay spending

Dealing with the urge to splurge? Joe Udo of Retire By 40 has a simple yet effective tip – give it time. Waiting a few days can be a game-changer. Whether you're eyeing a shiny new TV or contemplating a fresh set of wheels, this habit proves handy. The magic lies in the potential to discover a sweeter deal or, perhaps, to realize that the desire was fleeting. It's not just reserved for big-ticket items either; everyday purchases can also benefit from this waiting game. So, before you reach for your wallet, take a breather – those extra moments might save you both money and regret.

3. Ditch auto-pay

Shannah Compton Game, a Certified Financial Planner and the voice behind the Millennial Money Podcast suggests a savvy money move – ditch those auto-pay and auto-fill features on your go-to shopping sites. Why? Well, according to her, it's all about making you pause and ponder. By removing the convenience of automatic payments or saved details, you're forced to actively consider the cash you're about to shell out before giving in to the allure of the "buy now" button. It's a strategic step to ensure that each purchase gets a second thought, promoting mindful spending in the age of one-click temptation.

4. No more financial shocks

Surprise bills? Not so much fun. Erica Gellerman, the brains behind The Worth Project, has a trick to dodge those financial shocks. Her advice: treat your credit card like a trusty debit card. So, if you splash $10 on lunch and $40 on gas, here's the move – whip out your credit card app and promptly transfer $50 from your checking account. It's like a financial reality check, ensuring you're only spending what you've got in the bank. No surprises, no post-month bill blues – just smart money management.

5. Pre-pay credit card bills 

Here's a brilliant suggestion from Compton Game: "Pre-pay your credit card with your weekly budgeted expenses," she suggests. This move acts like a financial guide, ensuring your bank balance stays on track and preventing you from dipping into funds you don't actually have. It's a proactive approach to money management. Just a word of caution: while this strategy works wonders, be sure to steer clear of using your credit card for certain purchases.

6. Paying of credit balance

Wondering why you should be cautious with credit cards? Two words: interest payments. Joe Udo spills the beans, emphasizing that his credit card strategy revolves around paying the bill in full each month. By doing so, he enjoys the perks without forking over extra cash to the bank. But here's a handy rule of thumb: if you can't settle the whole bill, avoid carrying more than 30 percent of your credit limit into the next month. Bonus tip: This habit of paying off your balance monthly is a golden ticket to boosting your credit score. Here's what you need to improve your credit score.

7. Switch to cash

If you're grappling with a hefty credit card bill each month, Joe Udo has a practical solution – switch to cash. It's not just about staying within your financial limits; Udo highlights that physically parting with cash is a more tangible and deliberate act compared to the ease of swiping a card. By opting for cash transactions, you create a built-in pause that forces you to think twice before spending. It's a straightforward yet effective strategy to curb excess spending and promote a more conscious approach to your finances.

8. Use savings apps

Saving money every month can be a challenge, but Sophia Bera, Certified Financial Planner and founder of Gen Y Planning has a clever trick up her sleeve. "Automate your savings and retirement contributions so you don't have to think about it, yet you're steadily moving towards your goals," she recommends. An effortless way to achieve this is by using a savings app. These apps can take the guesswork out of saving by automatically allocating funds to your goals, making financial progress a seamless part of your routine without the need for constant manual intervention.

9. Inexpensive fun alternatives

Having extra free time can sometimes lead to increased spending, whether it's brunch, happy hour, or spontaneous shopping. Erica Gellerman, the mind behind The Worth Project, reflects on her own experiences, noting that while these activities are enjoyable, habitual spending on things she didn't truly value became apparent. Her solution? Maintain a list of budget-friendly alternatives to replace costlier pastimes. Now, instead of defaulting to expensive habits, she opts for activities like hosting friends or going on a hike. It's a strategic switch that not only preserves the joy of leisure but also keeps the budget in check.

10. Create an emergency fund

Here's a stark reality: In 2019, a whopping 45 percent of Americans had zero savings, according to a GOBankingRates study. But here's the kicker – to steer clear of falling into debt, financial experts advise having a safety net that can cover at least three to six months' worth of living expenses. It's not just about cushioning against unexpected blows; it's a smart move to weather any drastic events without sinking into financial turmoil. So, while the stats might be alarming, the key takeaway is clear: building a solid emergency fund is your ticket to financial resilience and peace of mind.