How to Live Debt Free

Not owing money to many creditors is a goal of many people. While this is a great to aim for, it can be challenging. This is an obtainable goal if you make a few changes. 


Creating a budget is extremely important. Start by writing down all your expenses. To do this, list everything you spend money on for several weeks. When budgeting, most people forget the smaller expenses. The cup of coffee they buy every morning or the magazine subscription they are receiving. After listing your expenses you need to write down your income. Compare how much money you receive each month and to how much you are spending. The objective is to spend less than you earn.

Cut expenses

The more money you spend the more difficult it is to get out of debt. Look at your expenses and figure out what you can live without. Divide the list of expenses between needs and wants. Prioritize what items you truly need and stop spending on as many items as you can: premium cable, manicures or a cell phone. The more items you are able to cut, the more money you will save each month.


Once you start slashing the expenses, take half of the money and put it into a savings account. The other half should be used to pay down your debt. Saving will help you create a needed cushion in case of an emergency. Watching your savings grow will show you are making progress.

Credit cards

Start paying your higher interest credit cards first. More importantly you do not want to close the credit cards once you pay them off. Your credit score is reliant on your credit to debt ratio. Once you pay off all your credit cards, pay the balance at the end of each month. If you don’t have the cash, the item you are looking to purchase is not in your financial plan. You need to learn to curtail your spending in order to live debt free.

Get another job

If you have a large debt getting a second job may be necessary. Having an extra income to help pay down the debt quicker and build your savings will make a difference.

Living debt free is reachable. It will take time. Dedicate yourself and stick to your budget. Before you know it you will be debt free.

Cut down on spending

Improve your credit score