Whether it’s the result of a job loss, sudden medical expenses, or irresponsible spending, numerous people are faced with an overwhelming amount of debt. In many cases, the only way to alleviate the stress of unpaid bills and the persistent pressure of creditors looking for repayment is to file bankruptcy. Fortunately, there are several ways to keep yourself from getting to this point. Taking a proactive approach with your money management will help you stay financially stable.

5 Debt Avoidance Strategies to Implement 

1. Establish a Budget 

Setting a budget is one of the first steps you should take towards maintaining a debt-free life. This will help ensure you aren’t living above your means. Once you see how much income you bring in and compare that with your monthly expenses, it may be necessary to cut back on frivolous spending. 

2. Build an Emergency Savings Fund 

Going into debt due to unforeseen expenses is common. Having a substantial amount put away in an emergency savings fund can prevent this from happening. It’s typically suggested that you build up at least a six-month cushion to keep you afloat while you deal with whatever hardship has arisen. 

3. Pay Your Credit Cards Off Each Month 

When using a credit card, it’s best practice to only charge what you can afford and pay off the balance in full each month. This will allow you to avoid having to pay interest and eliminate the worry of being able to meet your minimum payment. It’s also vital to make sure you don’t start missing payments, as this will lead to late fees and higher interest charges. 

4. Make Sure You Have Adequate Insurance Protection 

Life is full of unexpected events that are impossible to plan for. However, insurance is available to help maintain financial security should disaster strike. It’s essential to make sure you have adequate protection in all areas of life that have the potential to affect your finances. 

5. Steer Clear of Cash Advances 

If you’re trying to stay out of debt, cash advances are not a good use of your credit cards. It’s a good indication you’re already in financial trouble and heading towards bankruptcy if you can only get cash through your credit card. Having a budget and savings should keep you from needing a cash advance in an emergency.

Racking up debt is easy to do, especially if you frequently use credit cards. If you already feel you’re at risk of needing to file for bankruptcy, it’s a good idea to consult an attorney about the best solution for your situation. The legal team at Bueker Law Firm has years of experience guiding residents in and around the community of Stuttgart, AR who are looking to explore their debt relief options. They have the knowledge and resources necessary to help you reach your financial goals. Call (870) 673-1313 for sound advice on steering clear of debt, or visit their website to learn more about the bankruptcy services they provide.