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Scott Tominga Guides on How to Stay Debt-free In Financial Life

None desires to fall into a debt trap. It is overwhelming, stressful, and requires paying pay costs that people could be avoided by spending more sensibly. Being debt free equally means that they need not be worried about paying high interest for late payments, losing the car, or facing bankruptcy. The distinguished professional in financial and wealth management Scott Tominaga has devoted decades to serving in sectors like banking, personal finance, stock trading, etc. Here, the professional offers a guide to let people enjoy a debt-free financial life.   

Preparing A Budget And Sticking To It


Budget offers a roadmap while reminding if individuals are going off their track which means crossing the preplanned line of spending and thus helps them live within their monthly income. Once people can gauge their affordability level, this will automatically get them an insight into making better financial decisions. 

Controlling Expenses On A Regular Basis


Every family has certain regular expenses. People know well about the bills like utility charges, rent, etc. that they have to pay each month. Individuals should have an eye to keep their regular spending as minimum as possible. It is an effective way to manage their expenses as well as avoid debt.  

Individuals should refrain from shopping for anything that they cannot afford to pay for. For example a costly smartphone or outfit. This basically defines the ‘want’ (desire) and not ‘need’. The best way to meet their desire is to save for it and once the money is accumulated, they can go and meet their craving. By this, people can avoid overusing credit cards that require paying an excessive interest rate on them.    

The expert says that people should start tracking their regular expenses by developing a spreadsheet as it will help them assess their expenses toward their needs and wants. Accordingly, they can figure out where they are spending more or where they can cut back. The amount they cut back will be their saving.  

A thumb rule of realistic budgeting is 50/30/20. Individuals should utilize 50% of their monthly earnings for regular expenses, 30% for non-essentials and 20% of their income will go into savings. 

Saying ‘No’ to Using Credit Card


This does not mean that people cannot apply for credit cards. But they should make sure to use their credit card only in an emergency and not for meeting their desires for which they don’t have enough money right now. Here are the reasons why should they avoid using credit cards:

  • Having credit disheartens one’s spending habits.
  • This will equally discourage people to develop a budget. 
  • Interest rates on credit cards are incredibly high.
  • Crossing the due will attract excessively high interest on unpaid balances. 
  • A bad credit score has a great impact on one’s financial life. 
  • Leading to bankruptcy is a common incident. 
  • Can ruin one’s self-esteem and mental peace.

Develop An Emergency Fund


An emergency fund works like our safety net and provides people funding in the event they fall short due to unforeseen incidences. According to Scott Tominaga developing an emergency fund helps deal with any crisis like paying an emergency medical bill or missed income due to job loss. Instead of using credit cards, it makes sense to create such a fund for rainy days and most importantly – because by using this fund people don’t have to pay any interest.  

Elorabrown Blogger & Admin Shoutonn.com


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