5 Tips to Avoid Toxic Debt for a Secure Financial Future

Swimming With Sharks -Get Out Of Toxic Debt

5 Tips to Avoid Toxic Debt for a Secure Financial Future Source: The Digital Way on Pixabay

The burden of debt isn’t just stressful; it can be genuinely debilitating when it comes to your finances. Don’t feel like bankruptcy is the only solution. Here are five tips to avoid toxic debt for a secure financial future.

Avoid loans

Some loans are unavoidable. We always hear about “good debt,” such as your mortgage or useful student loans, but there’s definitely bad debt too. These are fast cash loans, credit card debts, and just generally living beyond your means. But what are you meant to do if you’re in a financial bind? Life happens. The car needs repairs. Medical bills come back larger than expected. What do you do? Don’t even think about borrowing from your 401k. Instead, if possible, pay with cash or seek payday loan alternatives. If it comes down to it, bite your pride, and ask a relative for a little assistance while in need. But don’t abuse generosity. Christmas should only come once a year.

Create an emergency fund

Speaking of life’s unexpected financial pitfalls, there are certain measures you can take to protect yourself from falling into toxic debt. Focus all of your savings (and you should be saving; you don’t want to be one of the 23% of Americans that save no money from their paycheck) on creating an emergency fund. This is the money that buffers you from life’s mayhem. Instead of falling into debt, you can fall back on this money held in your account, ready to go at a moment’s notice.


Budgeting is a skill that gets easier with practice, but it is imperative you start today if you don’t already have one in place. While it may seem complicated, budgeting is as simple as seeing what money comes in and where it needs to go. Focus on the word “needs.” We put our needs at the top of the list and categories such as “entertainment” or “clothing” last. Now, that isn’t to say you shouldn’t enjoy life; it’s just that those things need to come after essential expenses like rent, grocery bills (not restaurant tickets), and saving for that emergency fund. This budget will let you see exactly where your money is coming from and where it’s going. This control will eliminate the risk of running deep into debt.

Pay off balances

If you have credit card debt, that should be your second priority after your emergency fund. By living within your means, you don’t have to rely on credit cards to pay for your necessities. But if you have already accrued debt, you need to cut back on your expenses with that handy-dandy budget. Tackling credit card debt is important because it tends to carry huge interest rates that eat away at your much-needed income. After credit cards, you can start focusing on any other lower interest rate debts you may have.

Get creative

Remember the entertainment and clothes we talked about earlier? You don’t have to live without. By getting creative, you can find the things you love while spending a lot less. Seek free things to do in your neighborhood in the evenings when you otherwise would be hitting the cinema. You can often refresh your wardrobe with items you already have by trying different combos instead of being drawn to the mall out of boredom. Don’t sacrifice your enjoyment; just find creative ways to enjoy yourself for less.

There’s no reason to let debt eat away at your wellbeing. Which of these five tips to banish debt and create a secure financial future will you try first?
5 Safety Measures to Work with Consolidation Loans
How to Become Debt-Free

3 Replies to “5 Tips to Avoid Toxic Debt for a Secure Financial Future”

Leave a Reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.

HTML Snippets Powered By : XYZScripts.com