Are you finding it hard to live within your means and looking for smart strategies that will allow you to avoid debt?

Well then, this post is exactly what you need. Listed here are quick tips that will reduce your dependency on personal loans or payday loans from legal money lenders.

Create a budget

You can’t do any financial planning without first creating a budget. Take stock of your current expenses and reduce them if your monthly expenditure is more than your income. Additionally, start building a contingency fund, into which you must deposit a certain amount of money every month. It would be much easier if you decide beforehand how much you’ll deposit into this fund every month.

Borrow from your friends or family in case of emergency

When you have a short-term financial emergency, you should first approach people close to you. Contact a lender only when this arrangement doesn’t work out. If you must take a short-term loan, consider taking a payday loan. The main benefit of this loan is that the amount due will be directly deducted from your next salary. Of course, if you want, you can extend the loan. However, this is something you should avoid doing at all cost. The reason is simple: a payday loan comes with a steep interest rate, and if you extend the loan, you will have to pay a lot more than the original amount.

Don’t borrow more than you can repay

This is the golden rule of borrowing. And you must never break it. Let’s suppose you need a personal loan and have a good credit history so far. You are eligible for a personal loan of $10,000, but you need only $3000—and that’s how much you can repay quickly. Anything more will put a lot of pressure on your monthly budget. You should resist the temptation of taking more than what you can repay. So in this case, apply for a loan of $3000, not more.

Pick a suitable credit card

Credit cards are convenient, but if you are not careful with them, they can put you in dangerous financial situations. You should pick a card that’s suitable for your needs. For instance, if you often fall back on your payment, which by the way is something you must remedy as soon as possible, you should opt for a card that has a lower interest rate.

Pay your credit card balance in full every month

You will have no problem as long as you pay the balance in full every month. Once you miss a payment, you’ll have to pay a lot more the next month, as it will be two payments plus the late fee.

As you can see, the amount due climbs steeply if you miss a few payments. And often when that happens, you have to take another loan, for instance, a personal loan to pay the previous one. That, in turn, starts a dangerous cycle, in which you are repeatedly taking one loan to pay off another.