Debt-free people don’t have a lot of credit. Credit, when understood and used appropriately, is a good thing. Debt-free people aren’t scared of credit. Instead they use it correctly to build their personal credit and pay their cards off every month to steer clear of interest. Credit cards should never ever be used as a substitute for cash. They must be paid off every month.
Here is a list of many reasons why and how people get out of debt and stay that way.
1. They are wise. They don’t live above their means.
2. They are patient. Impulsive purchases don’t affect them. They shop competitively and save until they can afford what they want.
3. They are confident. People who are getting out of debt don’t care what others think. They don’t feel the need to be defined by material things.
4. They are goal-driven. They plan for the future, and must map out a plan just how to get there.
5. They are responsible. Getting out of debt takes responsibility and maturity; two traits that match up well with patience (see #2).
6. They are willing to make sacrifices. Budget cuts are just temporary; once out of debt you can begin adding things back in. Don’t spend money on unnecessary things such as Smartphone apps or duplicating pieces of clothing in your closet.
Credit cards are like a double-edged sword, but being debt free is possible. Be practical. It just takes a little time and effort to do so.
Martin and David Sher are Co-CEO of AmSher Debt Collection Agency. Martin, a past president of ACA International, is the author of the Collector’s Pledge—signed by hundreds of thousands of collectors all over the world committing to treat people with dignity and respect. David’s past president of the International Association of Commercials Collectors, and with his brother, authored the book, How to collect debts and still keep your customers.