The Habits You Should Continue to Remain Debt FreeThis is a guest post written by Good Nelly, founder of My Way Of Viewing, check her out for tips on all things personal finance.

Paid off debts? What habits should you continue to remain debt free?

It requires no mention that life without debt is what we all want to achieve. No one of us want to be in debt. There are so many things to do in life than wasting your precious time worrying about how to pay off debt.

But, what happens when you pay off all your debt… Do you go back to your old habits and routine which led you to debt? No!

On the contrary, when you have finally been successful of getting out debt, don’t leave any stone unturned to put debt away from your life.

Few debts you should always avoid are credit card debt, payday loan debt, personal loan debt, and so on. However, you can take out a mortgage or an auto loan but make sure you manage them efficiently.

Here are a few habits which you should continue or develop to keep debts at bay.

Revisit your budget and make modifications

Instead of thinking ‘budget’ a thing that existed in the past and you no longer need it, revisit your budget and make modifications. I won’t attach the line ‘if required’ because most likely, you need to make modifications from time to time and it’s not a one-time affair. Then only, you’ll be able to manage your financial life the way you want.

First of all, revisit your budget at least once in three months to be sure that everything is working in your favor. However, if you’re expecting any financial change, then I would suggest that you revisit your budget every month.

Making even minute changes can help you follow it and at the same time, help you attain your financial goals.

Carefully examine what and how much you’re spending

You were compelled to change your spending behavior to clear your debt. Continue that habit. I would say that now you should scrutinize it even more since you’ll have to get back on track and build a good financial future.

So, stop splurging your hard-earned dollars and maintain strict vigilance on what and how much you’re spending. Curb your desire for spending since you have some liquid money after a long time.

However, celebrate occasionally but not spend more. And, when you want to spend on something, think and plan it carefully.

Allocate a significant amount towards achieving your financial goals

If you look this way, you have wasted a few years struggling to pay off debt and not able to pay attention to achieve your financial goals. So, now devote time and save a significant amount to attain your short-term and long-term monetary goals.

You should deposit an amount into your retirement fund, buy a house if you don’t have one, save for your children’s education if required, and plan for your financial future.

Also, have an emergency fund if you don’t have one. It may help you avoid falling into debt in the future.

Continue checking your credit reports at regular intervals

The financial advisers always say to check your credit reports at least once a year even when you’re into debt and you know that there are negative listings in your report.

However, keep this habit as you can dispute inaccurate negative lists, if any, which can reduce your score. Pull your three major credit reports, which is usually free of cost, once a year.

Make sure the spelling of your name, your address, and other important personal details are accurate in the credit reports.

Manage your credit card accounts and don’t close them

Paying off credit card debt is a bit tough since you have to deal with relatively high-interest debts. So, when you pay off debt, make sure it doesn’t come back again.

So, what habits will you follow even after you pay off all your debts?

Do not make the mistake of closing your credit card accounts, especially the oldest one. The length of your credit history is an important component of your credit score. Another thing, when you close a credit card, your credit limit decreases, thus increasing your credit utilization ratio.

Therefore, keep the habit of managing your credit cards by paying back the outstanding balance at every billing cycle.

Above all, make a promise not to fall into debt again!

Do you know the most important habit which you should continue? Just as you promised yourself to get out of debt, now, make a promise every day not to fall into debt again.

Believe me, it will help you make the necessary decisions and maintain certain habits to achieve it.

You make certain rules to follow like:

  • Not spending above a certain amount during weekdays
  • Allot a certain amount, to spend during the weekends, beyond which you won’t spend. This will help you to enjoy but within your limit.

One important piece of information:

If you can foresee that you’re about to experience a financial hardship, inform your creditors beforehand. For example, if you guess that you can be laid off, inform your creditors instead of waiting for that to happen.

When you inform a credit card company about your situation, it can reduce the interest rate temporarily. It may also extend your payment deadline so that you have some time to make the payment.

So, maintain these habits, have faith in your decisions, and a enjoy a debt free life!

Good Nelly analyzes financial happenings and writes articles to aware and help her readers plan for their financial future. You can go through her blog My Way Of Viewing. She has been associated with Debt Consolidation Care for a long time. However, she has contributed her articles to other websites, too. Be sure to follow her on Facebook, Twitter, and G+.