How to Master the Art of Debt-Free Living

Debt can be so easy to get into yet so difficult to get out of. What does your debt look like, right now? Did you take out a student loan to get your degree? Have you spent thousands on credit cards to get things you thought you needed?

It can be a challenge to think about paying off all of your debt, but if there’s anything that brings peace of mind, it’s living a debt-free life one day. Whether you want to reach a high net worth or have big plans for your retirement, having too much debt is something that can weigh heavily on us.

So, what can you do to master a life lived without debt? Here are some tips to help you learn how best to manage your money, so you can avoid a life full of debt payments. It’s not easy and it requires dedication to the end-goal, but you can rest assured, it will be worth it. Here are a few steps you can take to master the art of debt-free living:

1. Don’t use your credit card for emergencies. Instead save for an emergency fund. If needed, open an account specifically for emergencies, where you only ever use it for those times when your child needs an unexpected hospital visit or your car needs costly repairs. Things like new clothes or a new haircut on a whim don’t belong on this specific card.

2. Consider the idea of not using a credit card. In this country, credit scores are everywhere you look. It’s a vicious cycle and unfortunately one reason why so many in this country are living in debt. In some ways, it can be difficult to do different things without a credit card, as so many necessary things—like simply opening an account at a credit union—require credit history. However, living without a credit card means you’re not living on money you don’t have and thus, not racking up debt.

3. Have goals you’re saving for. It’s easy to take money out of savings when you have plenty of it left over and nothing to spend it on. However, when you set goals, it makes it easier for you to avoid spending the money, as the goal trumps the desire to spend more on unnecessary things. Essentially, you should look at the money in your savings as money you don’t have. If you spend it unnecessarily, you may not have it when you need it.

4. Invest your money. If you’re making enough money to be setting aside substantial savings or have some extra cash, you could consider investing. Nothing grows your money like investing. Whether you make a smart financial move by investing in real estate or a mutual fund, there are several ways you can avoid debt and grow your money while you’re at it.

5. Make a budget. At the end of the day, the unnecessary expenses and random purchases are more than likely due to the fact you may not be using a budget. Those who avoid debt and are able to build financial wealth most certainly have a budget. While making a spreadsheet for your expenses and bills, plus income, may not be an appealing idea to you, the good news is that there are apps you can use on your phone that will help make it that much easier to keep track of it.

6. Avoid random purchases. It is so easy (so easy!) to make purchases here and there. You see a cute top on another woman while out and determine you need to get it. You buy the latest gadget your bros are using because it seems cool. Random purchases because “we feel like it” or “treat yourself” can be a detriment to our financial stability. When you check in with how much you spend on a monthly basis, you’re able to see all the times you spent money that would have been better used to save. It’s good to treat yourself every now and then, but make sure it’s allowed on your budget.

7. Pay off high debt first. If you already have debt, start paying it off as soon as possible. If you can set aside savings, you can start making debt payments, as well. Start with the debt that has the highest interest. Since interest builds up and the highest one could be hurting your pocket, the sooner you pay it off, the easier it will be to start saving. A debt-free life only comes when you’ve paid off any and all of the loans and financial obligations you may already have. So, before you even start saving, consider making payments on your debt first.

8. Make more money. At times, situations arise that require money we may not have because of our fixed income. Whether it’s a car crash or hospital visit, we may find ourselves in situations where we have to pull from our savings or use a credit card. If you’re finding that you are getting into debt because you are unable to make enough money at the moment, consider starting a side-job, at least for a time. For example, what if you have 5,000 in debt? It won’t take forever to pay off but it may mean you need extra money to become debt free quickly. If you pick up some more work or try to find a job with an increase in salary, that extra money can go towards your debt. You may be tired, and you may not love it, but when your debt is paid off, you’ll be glad you made the sacrifice of a few late nights or early mornings to get it done. If you don’t know what other job to get, look at your hobbies. You may be able to make some extra cash from something you love to do.


Debt doesn’t look good, and it doesn’t feel good either. If you want to live a debt-free life, start by making these tips habits today. From saving your money to investing it, and cutting out unnecessary expenses, avoiding debt is possible, and it’s completely worth it. Take the first steps today and start seeing just how much better you feel as you relieve your financial burdens.

About the Author

Jacob Dayan graduated with a Bachelor’s in Business Administration from the University of Michigan’s Ross School of Business. He began his career as a financial analyst at Bear Stearns’ industry leading Financial Analytics and Structured Transactions group. In 2010, he co-founded Community Tax LLC, a tax company dedicated to helping customers nationwide with tax resolution, tax preparation, bookkeeping and accounting services. As CEO of Community Tax, Jacob Dayan has assembled a strong team of attorney practitioners, CPAs and enrolled agents to deliver superior customer service and expected results.

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The views expressed in this article are those of the authors and do not necessarily reflect the views or policies of The World Financial Review.