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How To Avoid Debt If You Want Financial Stability

  • April 22, 2019

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How To Avoid Debt If You Want Financial StabilityWhile few of us have the privilege of being entirely debt free, minimizing the money that we owe can undoubtedly help to keep us as financially stable as possible. Sadly, with so many of the most vital things in life being paid for by borrowed money and credit, few realize that they can avoid, or keep what they owe to a minimum. Luckily, that is precisely what the post below explains how to do, so if you want to stay on an even financial keel, read on to find out more.

Credit cards

The number one offender concerning financial security are credit cards. In fact, these little pieces of shiny plastic can get you into some serious trouble that it can take years to pay off! The reason for this is that credit isn't free. In fact, it's a loan that your provider gives you that allows you to purchase an item, and as such you will incur a fee for that privilege.

Of course, the kicker is that the fee isn’t a one-off amount, but a percentage of how much you still owe each and every month. What that means is that the longer you take to pay back your credit card debt the more it will cost you.

In fact, there are other issues concerning credit card that you need to be aware of as well. In particular, take note of the percentage amount usually referred to as APR at the time of taking out the credit. The reason is that the higher the APR, the larger the percentage on what you owe you will have to pay back. Something that can cost you a lot more than you bargained for.

Additionally, when it comes to credit cards be careful of 0% interest offers and credit transfers. Yes, these can be useful in the short term, but if you miss the repayment date, you can still end up incurring a fee above and beyond the amount that you have borrowed.

Happily, it's not all doom and gloom for your financial security where credit cards are concerned, because there are some things you can do to avoid and minimize this type of costly debt. The first thing you can do is to avoid taking any credit out at all. After all, you can't get into trouble if you don't have any debts to pay back. The problem with this is that you need to have proven credit score to purchase more extensive and more essential items such as when getting a car loan and even a mortgage, so avoiding credit cards altogether may not be a practical option for many people.

That leaves you with the second possibility, which is to use a credit card but always make sure that you pay your amounts on time, as well as over-pay what you owe. This should then keep your credit rating high without incurring any extra cost and fees. Something that will help you to minimize your credit card debts and help to keep your finances stable.


Next, if you are looking to maintain your financial stability, it's absolutely crucial that you avoid having to pay out compensation to another party.

Of course, paying compensation can be required if you are taken to court and the case is successful. In fact, it's often it, not just compensation that you will have to pay, but you could also be facing the very real threat of a jail term as well. Something that is not only highly unpleasant but can ruin your life financially too, because not only can you not work for the number of years that you are locked up, but it can also make getting a decent and well-paying job once you get out very challenging as well.

Now, the best possible option here is to avoid getting into a situation where you are breaking the law, or that causes injury to someone else. Something that means ensuring that you drive as safely as possible, avoid altercations, and generally act responsibly.

However, if you do have the bad luck to end up being involved in a potentially illegal and injurious situation, and then being charged with something like aggravated assault it is well worth investing in the best criminal defense attorney you can find. After all, if you win the case or even minimize the charges against you, you can not only save money regarding compensation, but it could be the difference between serving a jail term or not as well.

Medical debts

If we could control our health at all times, and never get sick, I'm sure that is what most of us would choose to do. Sadly, the real world is not like this, and we don't always know what accident or illness will befall our loved ones or us.

Related: The Average Cost Of Health Insurance

Of course the main issues her is that medical treatment is expensive! In fact, even reasonably minor or routine procedures can cost a great deal of money, primarily because of the privatization of medical care in this country. What that means is that many people don't have the funds immediately available for the treatment that they need and this leads them to take out debt via their medical provider, something that can be incredibly costly.

Now, one way of dealing with this is to ensure that you have full coverage medical insurance, something that means no matter what happens, both your immediate and long term treatment will be covered by your provider.

Tragically, unless you work for a business that provides such cover for you and your family, or have enough of your own money to pay for it, this is also often a costly option, pricing it well out of many families budget ranges.

To that end, if you do find yourself in need of medical treatment that can threaten your financial situation, it may be best to shop around for different loan providers, picking the cheapest one. After all, it can make a huge difference in what you pay back and how long you need to pay off the loan, and so help to keep your financial situation as stable as possible over the long term.

Student Loans

Catch 22 is how many people describe their student loans. This is because without a degree they will struggle to get a high paying professional job. However, to go through the 3-4 year of college that will allow them to gain their degree, it can cost anything from $4000-$35,000 a year!

Obviously, once qualified, these loans then need to be paid off which can make a significant dent in your earning potential, and keep even those in a professional position in a relatively low income for a considerable time.

A college education can be a good investment, but also be responsible for massive debt.  

Of course, some things can be done to avoid or minimize such issues. The first is to avoid getting a student loan at all, something that may be possible if your parent can fund your education, or if your grades and achievements are high enough to get you a scholarship place at the university of your choice.

Alternatively, it may make better financial sense to go to a community college and pay around $21,000 less a year than you would at a private school. Especially if what you want to do when you qualify doesn't need an ivy league education or the contacts you will make in these instructions.

Lastly, the options that many students choose is to work almost full time while studying as well, meaning that they don't end up racking up any debt while at college. Something that means as soon as they are out in the real world earning money, they are in a much more financially stable position.

Of course, this latter option is not an easy one, because it means juggling full-time education with nearly full-time employment, which doesn't leave a lot of time left for socializing, relationships, or even rest. Therefore, it's crucial that you weigh up the pro and cons and the practicalities of working while studying before you commit to this route.


Mortgages are usually the most expensive debts that people acquire during their life. That means they can play havoc with your financial security, especially if you don't keep up with the payments, or you end up purchasing a home that actually falls in value rather than increases.

What that means is that if you can avoid getting a mortgage at all, you will be in a much more financially stable position! Happily, this may be something that is easier to do than you may think. In fact, one option is to live at home until you have all, or a significant portion of your deposit saved, something that means you will pay a lot less interest on the remaining money that you owe.

Alternatively, some folks are thinking outside of the box and choosing to build their own tiny homes instead. These being much smaller properties that take a lot less money to create, and so have a much lower impact on your financial situation. This being a solution that helps you to have a roof over your head but still stay financially stable.