Five Ways to Avoid Personal Debt

To avoid personal debt resist impulse buys, avoid using your credit card and keep up with repayments, write up a budget and shop around for better deals.

It is extremely important to learn to manage your finances and stay out of debt. Personal debt can become a serious issue and many people find that they are unable to do things like make mortgage repayments, pay their rent, service loans and keep up with credit card repayments. Some people even struggle to pay household bills and do their weekly food shop. To avoid a visit from a Debt Collection Agency you need to keep on top of your finances and avoid personal debt.

Resist impulse buys

A bit of retail therapy every now and then is ok, but if it is something that happens all the time you may find yourself getting into financial trouble. If you find yourself going to the shops with the intention of buying one particular item but then coming home with a pair of shoes, three dresses similar to five you already have and the latest electronic gadget that you feel you just can't live without, then you have a problem with your spending. You have to teach yourself to resist impulse buys. You should even apply this when doing your food shop. Make a list of the things you need and stick to it. Those extras that you put into your shopping trolley quickly add up and can easily double the cost of your weekly food bill.

Credit card

Credit cards can be handy but they can also be a trap. If you find that you put everything on credit with the attitude that you will worry about paying for it later then you should consider getting rid of your card, especially if your credit card debt is in excess of your card limit. Credit cards are good for an emergency, and if you can keep up with your repayments, but if you can't trust yourself then don't have one.


Writing up a budget is a great way to stay on top of your finances. Work out what you spend each week on food and petrol and other necessities. Go through your utility bills and average out what you spend each month. Remember mortgage or rent and factor in any insurance or health cover. Include an amount that you spend on entertainment and gifts, as well as clothes. Once you have a list of what you spend your money on then you can write up a weekly, monthly and even yearly budget. The key then is to set aside a portion of money each week that you can save.

Pay bills on time

Don't put off paying your bills for another time. Pay bills when they are due so you can keep on top of them and so you don't have the next one due just when you have finally paid the initial bill. As well as risking having utilities disconnected, or getting overdue notices or even late fees, you could be putting yourself at risk of being visited by debt recovery services and this can affect your credit rating, which is an issue if you want to borrow money or take out a contract on a service.

Look for better deals

Shop around when it comes to things like your mobile phone, internet and landline. Many services offer competitive deals and you need to work out which is best for you. Electricity and gas companies offer different rates so do a bit of research. Shop around with everything you purchase, it can benefit your finances in the long run.

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