Tips for getting and staying out of debt
HATTIESBURG, Miss. (WDAM) - When you enter a store or even open a shopping app on your phone, do you ever question yourself before buying anything? Do I need this or is it just a want?
That simple question and mindset can save you in the long run.
Many believe money is what helps the world go round, but it can also get you into a place that can take several years to get out of.
Give. Save. Spend. Out of the three, many people usually only focus on just one. The one that can lead to an overflow in debt.
“Well, obviously spending more than you make,” said Mike Morgan, a finance professor at The University of Southern Mississippi. “When your outflow exceeds your inflow, you’re digging a hole, and I think sometimes when people go into debt, they know they’re going into debt but they don’t want to acknowledge it.”
Morgan spends countless hours studying and teaching, and discussing debt is a major topic he covers with students.
“One thing people do is they just don’t address it,” Morgan said. “It’s out of sight, out of mind,” Morgan said.
So, in this world of numbers and transactions, how do you pull yourself out of debt?
“First thing you need to do is assess where you are and how did you get there,” said Morgan.
According to Morgan, credit cards are known to be the leading cause of debt.
“That’s a recipe for financial disaster, because the interest rates are so high, and its almost impossible to get ahead when you’re paying 20% on a credit card. So, attacking credit card debt is probably the number one priority,” Morgan said.
Morgan said with student loans deferred another three months, people should try getting ahead on other debt instead of spending excessively.
“It seems like it will never end,” said Morgan.
To avoid the stress and worry of sinking in debt, Morgan believes it is important you keep up with the money that’s going out.
“Some people never sit down and look at where is my money going,” said Morgan. “Simply pulling out your credit statements and your bank statement at the end of the month and looking at where did we go eat, how many times did we go out, how many times did we stop at the convenience store. You got to look at it and be cautious of what you’re doing so you can map out a plan.”
While mapping out a plan is ideal, it can also be intimidating. Morgan said it’s best to have a budget in place to determine where all your money will go. He also advised to not be too consumed by tedious financial planning.
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