6 Strategies to Help You Stay Out of Debt

If you’re not careful, getting into debt can be like walking into a swamp. One minute you’re on sound footing financially and the next minute you’ve sunk up to your neck in debt. And unfortunately, getting out of debt is a lot harder and a lot less fun than getting into it.

To make matters even worse, we’re now into the holiday shopping season, a time when it’s just amazingly easy to get carried away in the spirit of the holidays and run up even more debt. If you want to keep this from happening to you, here are six strategies you can use that will help you stay out of debt or at least minimize the amount of debt your run-up.

Plan your shopping

One good strategy is to plan your holiday shopping just as you would expect your grocery shopping. In other words, make a list of the people to whom you will be giving gifts, along with the amount you can afford to spend on each. Then don’t vary from this plan. No matter how tempting it might be to pick up that extra little something for your spouse, resist the temptation.

Use just one credit card.

If you do your shopping with multiple credit cards, it’s easy to lose track of how much you’ve spent until those offensive statements start rolling in. A better answer is to take all of those credit cards out of your wallet or purse except for the one that has the lowest interest rate. Then put all your purchases on it.

Don’t charge what you can’t pay off.

Third, don’t charge anything unless you are sure you can pay it off when you get your next statement. Failing that, keep your spending down to a level where you can zero out your balance within a reasonable amount of time – maybe two months at the most. This will not only help keep your spending under control; it will save money on interest.

Don’t fall for one of those store card offers.

There you are standing at the counter, and the clerk says,” you could save 20% on this purchase if you apply for our store credit card today.” If you’re making a significant purchase of several hundred dollars or more, this can be very tempting. Resist the temptation. Most store cards come with incredibly high-interest rates of 20% or higher.

Stay away from those special offers.

Most of the credit card companies are offering all sorts of incentives these days to get you to sign up for their cards. This includes 0% interest balance transfers, additional cashback in specific categories, or extra perks if you meet certain spending levels. Again, resist. No deal is a good deal unless you can afford it, and in those immortal words, there is no such thing as a free lunch.

Use the Internet

Before you make any significant purchase, do some comparison shopping online. You might find a special offer, or at least you’ll know what the item should cost. If you don’t want to make the purchase online, you could print out information on the product with is price, take it to your favorite merchant and ask if it would be willing to price match. You could keep from running up more debt just by using this simple strategy.