When you’re weighed with debt, it often appears like a herculean task getting out of it.
So, you keep wondering what could be the debt-savings or moneymaking magic wand to that could fix the problem in an instant.
Sometimes, the solution is not as difficult as we imagine. You might simply just simply need to STOP. Yes, stop doing what’s sinking you into debt.
Consolidating your existing debt is the most straightforward way to get your debt under control. Using online tools like a loan repayment calculator can also help you draw up a budgeting plan. Take advantage of the tools you have at your disposal.
And for spending, focus on using cash only. Here are reasons why:
- Spending cash only helps you better understand what you actually need from you want
Unlike a credit card, when you enter a store with cash-only you’re more conscious of the right spending limits for you, and so can better differentiate between the things you really need from those you really want.
But with a credit card, you’re more likely to throw everything that catches your fancy into the cart, since you have your credit card with you.
- With cash, you’re wired to spend less
Spending on your credit card doesn’t hurt like cash, until the debts stare you in the face. But with cash, you develop an internal check mechanism since you can see the money leave your purse and feel the pinch.
So, you naturally get more conscious about your spending pattern and thus avoid unnecessary debt that you would have accrued with a credit card.
- You avoid impulse spending
Researchers have discovered that people are more likely to make impulse buying on luxury items when they shop with credit cards and gift certificates. They view credit card money like some sort of “play” fund.
But with a cash-only diet, while the shopper may feel some pain on not spending on all of the items they want, they benefit in the long term by remaining debt-free.
- Spending cash can help you get a good deal
With cash, you’re more likely to get more bargaining power with a salesman. Have you noticed how much tradesmen love the scent of cash? Try going cash-only on your next big purchase and see how you get better deal.
You become more creative and enterprising
With a more frugal lifestyle that comes with a cash-only diet, you’re able to soon get out of debt and save more. But your more disciplined instincts take you a little further: you become more creative and enterprising and start thinking of ways to further improve your financial situation.
You’re more confident about and can plan for the future
Your view about money will begin to shift as you focus on spending cash only and your accumulated debts starts to recede slowly but steadily. You get more emotionally healthy, stress-free and happy and begin to confidently plan for the future.