9 Mistakes People Make Trying To Get Out of Debt!

3) Not Creating a Practical Budget

Not having a practical budget could be the cause of your debt issues in the first place. If you don’t operate on a budget currently, now is the time to start. If you don’t have an idea of what you can afford without creating more debt, that’s a big mistake. The rule of thumb should always be, don’t spend money you don’t have. The second rule is, don’t borrow from Peter to pay Paul. Create a budget that’s practical and based upon your income to expense ratio. That way, you’ll get in the habit of knowing what you can afford without charging it and creating more debt. If you withdraw cash on one credit card to pay another, or pay your bills, you’ll only be creating a snowball effect. The interest charged on most cash advances is something that will follow you for quite some time. Avoid doing this!