The holiday season has always been a time when you spend your money for enjoyment, celebration and gifts. Sometimes pocket won’t allow then also we spend. It has become a reason for increase in debt amount. Now, time has come to make a fresh start. There’s no better New Year’s resolution than to pay off your debts and clean up your credit record. So that for whole year you will be out of debt and can spend your each day without any tension.
To stay out of debt you need to take some decision.
Do's to stay from debt
Clear all previous debt.
If you have debt already on your head try to pay off. It would really help you to take new decision in your life.
Make budget according to your pocket.
When you prepare budget see your income and accordingly make your expenses. It will help to set priority in budget and controlling your finance.
Always keep enough cash with you.
When you go for shopping always keep sufficient cash with you and keep care of it that whatever you purchase that would come under the cash available with you.
Keep track of expenses.
Monitor and identified your hidden expenses, and take out the solution how to stop it.
Save money.
What ever money is left at the end of month try to save it rather than spend it. So that when you required extra money you can easily manage it from your savings.
Invest money for plans like retirement plan, provident fund etc.
Be futuristic, and invest money in such plans so that you need not to be worried about your future.
Do review your credit reports.
After a period of time keeps reviewing your credit reports so that you will be aware of your debt status.
Do make sure safe investments are actually safe.
Take advices from your financial adviser before investment and make it sure that it safe and help you to create your wealth.
Don’ts to stay from debt
Avoid payments from credit card.
Do not use credit card for making payments when you go for shopping or restaurant or any where.
Avoid copied others.
Avoid copied other life style. Spend life in such a way that would come with in your income.
Avoid borrowing money for debt consolidation.
Do not take loan or borrow money for your debt. It will not keep you to away from debt.
Don't invest in anything you don't understand.
When you are not aware of something then do not invest money in that things because it would become very difficult to handle.
Don't forgo necessary insurance.
Don't take more risk than you can handle.
Before taking risk think twice or thrice that how much risky it is? And will you be able to face it or not.
Don’t overpay your debts.
Keep sufficient money with you so that you can spend it for whole month. Then pay your debt whatever extra money is left with you.
Ignore credit card offers.
Do not run after the offer given by credit card companies. Ultimately you will have to pay that amount.
By keeping all this things in mind it becomes very easy to start New Year with lots of fun and joy with out having any tension.
Many people have lots of tension and sleepless night because of debt and when they are not be able to manage their finances.
Why sleepless night due to finance --- because when a person work for whole day and at the end of day when he returns home he won’t be able to fulfill the financial requirement of their family and as well as his own financial requirement.
Sometimes due to lack of finance, when people won’t be able to fulfill their social and status need, this also becomes a reason of sleepless night.
Let me discuss the theory of Maslow that is directly related to the human response with their financial capability and requirement.
It is also known as - Maslow need hierarchy theory,
Self-Actualization
Esteem Needs
Social Needs
Safety Needs
Physiological Needs
According to his theory,
He said, when people start earning money, at first they want to fulfill their basic requirements, when it fulfills then they start thinking to safe money for future prospects, then after they come to third stage, where they want to develop social relationship through many ways like working for human welfare, charity, kitty party etc. and so on. All stages are directly interlinked with finance. When they won’t be able to find this growth or development in their self it tends them to think over it due to lack of satisfaction.
This is not only reasons when they don’t sleep for whole night, there are some other reasons also,
Sometime people won’t understand why and how it happens?
Either it is mismanagement of finance or I am not able to judge what the right way to manage the finance?
Other than this one of major reason of sleepless night is Debt,
Having debts is a drawback that most individuals face. Oftentimes, the individuals who fall into debts are those people who don't have control over their spending habits.
If you have debt problems, you know that they can be something that takes your life and turns it into something that you might not even be able to recognize. Having debt problems is something that can take a regular life and make it a complete mess, and this happens very quickly, it might seem. In fact, most people spiral out of control until they have no idea how they got there or how to get out.
Only lack of money donot cause sleepless night sometime excessive money also becomes the reason for it.
How and where to invest?
So that it can be efficient utilized and return on investment is also high. It is not only matter of investment but also after investment there are many rules and norms to be fulfilled, then to keep track of all investments, etc.
So remember, you need to get yourself organized first, and once you have done this, you can better utilize your finance. Even it will help you to keep away from debt and any other financial crises.
Maintaining a debt free living is terribly rewarding because you will not spend countless hours worrying, instead you'll be able to use these hours to spend time together with your family
It also helps in management of finance and efficient utilization of finance.
