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Financially Distraught? 8 Ways to Avoid Debt

From the Show: HER
Summary: Are you a slave or a master to your money?
Air Date: 6/19/14
Duration: 10
Host: Michelle King Robson and Pamela Peeke, MD
Guest Bio: Sharon Lechter, CPA
Sharon LechterSharon Lechter is an entrepreneur, author, philanthropist, educator, international speaker, licensed CPA and mother. She is CEO of Pay Your Family First, an organization dedicated to financial education and the author of her newest book, Think and Grow Rich for Women.
  • Book Title: Think and Grow Rich for Women
Financially Distraught? 8 Ways to Avoid Debt
It's been drilled into your head since you took a home economics class in high school: you need to know where your money is going and live within your means.

Signing up for a credit card may seem like a great idea, especially when you think to charge it now, pay later. However, many people don't realize how easy it is to lose sight of how much money is being spent when you can simply "put it on the card."

Just because you have a credit card, doesn't mean it's free money. You're going to have to pay it back eventually.

Did you know at the end of the second quarter in 2013, there was an approximately $850 billion in outstanding revolving debt, mainly credit cards?

Whether you've just finished college or you're trying to buy a house, knowing where you are financially can help ease anxiety. However, if you're unsure of what to keep an eye out for, it's easy to fall in financial trouble.

To stay out of financial trouble and avoid becoming financially distraught, entrepreneur and author, Sharon Lechter believes there are eight tips to keep you in check.

One of them is to determine your debt percentage. Find out where you are financially, check your credit card reports and keep track of your debit and credit statements.

The next important step is to create a spending plan. What bills do you have to pay this week? How much are you able to spend on groceries? Is there any money you can use to go out to dinner or see a movie?

Keeping your checkbook in balance will help keep you in balance.

What are some other tips to avoid financial trouble?

Lechter discusses why it's important to stay on top of your finances as well as eight ways you can avoid going into debt.

8 Ways to Avoid Debt:

  • Determine Your Debt Percentage
  • Check Your Credit Score
  • Establish a Budget
  • Identify Wants vs. Needs
  • Exercise the Two-Minute Rule
  • Learn to Use Cash Again
  • Save for Setbacks
  • Celebrate Little Wins
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