Look before you spend, think before you splurge
By: ajeetkhurana | Posted: 14th November 2007
There is always pain in prudent money management. Most of this pain is inflicted by unexpected expenses. The best that one can do is to put away all one's savings in a bank for the future and try to not to go overboard with one's spending. But debt is something that we all fall prey to no matter how hard we try to control the amount of money that flows out of our wallets. Today when stores sell products and services on credit and one can faces no problems in shopping with a credit card; we can clearly see how spending limits have increased. Thanks to credit cards, the buyer can put off thinking about payments for the purchase for over a month. Only after that month has passed and the bill has arrived will the credit card holder have to make arrangements for the same. Thus, if such a person makes a purchase which he really cannot afford, he will be going beyond his means by inviting a debt that he will need to repay. Spending money that you do not have is one of the most common mistakes that people make. And, as we all know, it is a mistake that comes with a heavy price. It would have been charming if it was not sad that one runs up ones credit card bills with money that need not have been spent.
Similarly, sudden medical expenses are often the main reason that leads to financial disaster. Such expenses can leave us in debt for years to come because we were not prepared for them. Borrowing money or taking loans would be yet another way of landing up in a debt trap. These debt burdens could end up haunting us for a long while till we manage to repay them all. It is very easy to spend or borrow money, but when the time comes to repay this money, that is when we all start feeling the pinch. It is then that we start regretting having spent as much as we did. The most disastrous way of getting into debt is by gambling. The possibility of winning a gamble does exist. But one might end up losing a lot more in the process if things do not go one's way.
There are few ways by which a person can get out the debt trap. However, one should remember that getting into debt is a lot easier than getting out of it. Keeping close watch over the expenditure on a daily basis will give you an idea of where the money is vanishing. Another mode would be to stop using credit cards. This will bring down your debt burdens drastically. But I guess it is easy to realize that it is not easy to avoid shopping urges. If you have an EMI or a loan that needs to be repaid, consolidate the information and get in touch with the lenders. Keep them posted about your financial standing and ask for a grace period to gather the funds to repay the loans.
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Tags: amount of money, shopping, mistake, credit cards, wallets, spending money, credit card bills, loans, unexpected expenses, medical expenses, debt trap, money management, borrowing money, financial disaster, credit card holder, feeling the pinch, debt burdens, fall prey