Debt can be one of the biggest obstacles on your financial journey, but avoiding it is easier than you think if you build good habits early. So, how to avoid debt as a beginner? Here are some of our recommendations:
- Live Within Your Means
Don’t spend more than you earn. If you can’t afford something right now, save for it instead of reaching for credit. - Be Careful with Credit Cards
Credit cards are useful for building credit history, but they can also trap you in debt if you carry a balance. Always pay off your card in full each month to avoid interest charges. - Borrow Only for Essentials
Some debts, like student loans or mortgages, may be necessary. But avoid unnecessary borrowing for luxury items or things that lose value quickly. - Build an Emergency Fund
Without savings, you may rely on loans when unexpected expenses arise. Your emergency fund is your shield against debt.
The earlier you learn to manage your money, the easier it will be to stay debt-free. Think of debt as a weight—it slows you down. By avoiding it, you’ll move faster toward your financial goals.
