As we all know, getting into debt is a lot easier than getting out of debt. While no one means to go into debt, it can happen to the best of us. Often it will happen before you even know what hit you. Losing track of your finances and engaging in irresponsible spending are ways to get into debt quickly. This article is going to cover some of the fastest ways that people get themselves into debt.
When you buy a car, once you make that last payment the car is yours until you run it into the ground or just get tired of it and sell it. But when you lease a car you are basically pouring money down the drain. Why spend thousands of dollars on a car that you will have to give back when the lease is up. This is a bad investment to make and a surefire way to get yourself into debt.
Bad Investment Decisions
You’ve probably heard of people who have made hundreds of thousands using brokers like Independent Reserve to trade currencies. You might have heard of people successfully funding their retirement through unique investment opportunities or real estate. These success stories are often true, but there are layers to each type of investment that are important to understand, without them you can easily make bad decisions and fall into debt. So before you make your first investment, research the area thoroughly and seek council from an investment advisor for a second opinion. The last mistake you want to make is to put a large amount of money into a company that goes bankrupt weeks later. You could be following them soon afterward.
Gambling and Lottery Playing
While most of us will buy a lottery ticket every now and then, most of us also have the sense not to spend a ridiculous amount of money on lottery tickets. However, some people get carried away and start spending hundreds of dollars a week on lottery tickets that get them nothing. Others prefer to take their money to a casino and hope they win it back even though most of the time, most of us don’t. Either way, engaging in these activities too frequently is another quick and easy way to get yourself into debt. So before you play the lottery or head to the casino, think about how much you can afford to lose and when you’ve lost it, leave.
Co-Signing A Loan
Generally speaking, when someone needs you to co-sign a loan it is because they do not have good enough credit or income to qualify for that apartment or car themselves. Co-signing a loan means you are responsible for paying it if the other person defaults. This can lead you into debt before you know what happened. So unless you know someone is responsible enough to pay for their own expenses, avoid co-signing a loan for them or even lending money.
Credit cards are great when they are used responsibly. When they are not, you can quickly find yourself swimming in debt. It is far too easy and tempting to buy things you really can’t afford when you can just charge them to your credit card and pay for them later. The problem is, when later comes many people find themselves unable to pay back their credit cad company.
If you find yourself in debt one option is payday loans. They are an easy way to get the quick cash you need to get yourself out of debt.
Buying a car you can’t afford because you think you can justify it by financing that car is another fast way to put yourself in debt. Financing a car is not cheap. You are better off buying a car you can afford without having to finance it.