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Have you been worried about why you find it difficult to stay out of debts? Are you also concerned that the more you settle one debt another resurfaces?
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Worry no more; TheNewsBeam brings you goodnews this weekend. We have prepared five viable and practicable ways to stay out of debts for the rest of your life.
Five Ways to Stay out of Debts
Debt is the amount of money owed by an individual or organisation which needs to be repaid at a later time.
Distinguish your NEED from your WANT: If you truly want to stay out of debt, it is essential that you learn to distinguish your want from your need. I will try to delineate these closely-related terms.
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You must have learnt in your Economics class that want is insatiable. This simply means that you cannot satisfy your want because it is enormous. The more you satisfy a want, the more another resurfaces. Another important feature of want is that it has no negative implication on you if you don’t satisfy it.
Need on the other hand is what you must satisfy. Your body needs food to stay healthy.
Since you need food, then your want could possibly be to eat in an expensive restaurant when you can cook a nutritious food in your home.
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Prepare your Financial Budget: Another Mistake many of us make in life today is our failure to prepare a financial budget. A financial budget is a document that contains how you intend to spend your income.
When you prepare a written financial budget, it serves as your guide on how to control your extravagant spending. In your written budget, do ensure that your income is not below your expense. The moment your expense exceeds your income, you have a reason to borrow. To know how to prepare a budget, click here.
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Find a Side Hustle: Everyone needs more money to settle his/her insatiable wants. The best way to make this happen is by creating multiple sources of income. In this digital epoch, finding a side hustle is quite easy. Click here for some side hustles that could complement your major source of income.
Note: Never let your side hustle affect your major source of income, else you find yourself in an ocean of debts again if you lose the job.
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Opt for a Low/No Interest Loan: Oftentimes the need to borrow might be necessary. This is when your need exceeds your income in a particular moment. Note, not on frivolous ‘wants.’ Take only a loan of Zero or low interest. Also, when you borrow, cut your coat according to your cloth. This implies that you borrow according to what you can pay at most, three times.
Seek Help: The last item on my list is seeking help. It is not a crime to seek help whenever you can’t afford to do/get something important. You can ask your friends and family for help in order to raise funds towards achieving a viable project.
In summary, debt is not a death sentence on your growth, it is a circumstance you can overwhelm by attending to your need first, making a financial budget, getting a side hustle to complement your major source of income, opting for only zero/low interest loan and seeking help whenever you need it.
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