How to Establish Savings while also paying down Debt-the route to freedom

Balancing the seesaw

Nowadays life has become one expensive affair whereby even if people are earning whatever is in their pocket is barely enough to meet their needs. Some people due to this have found themselves borrowing money only to sink in the deep sea of debt. Such people find themselves sinking deeper into financial distress as they have to borrow Peter to pay Paul and the cycle of borrowing cannot be broken. This is why it is important to know how to establish savings while also paying down debt so that you balance the seesaw in that your creditors are happy and you too have a smile on your face.

 

Budget and discipline

If you want to be able to save while at the same time paying off your debts, you will have to make a budget and stick to it strictly. Do not just buy things due to impulse. You will have to know where every cent goes and account for its use. Well even if you will be sticking to your budget do not imprison yourself. If your favorite treat was ice cream you can still indulge in enjoying it but now you will have to reduce the quantity and frequency. It is also advised that one pays the minimum amount required in their bank accounts so as to keep them active. Opening an emergency fund is also recommended so that you do not go back to borrowing in case an emergency strikes.

 

Climb the Mountain from the Bottom

Another good way of how to establish savings while also paying down debt is to climb the mountain from the bottom going up. This simply means that you start by paying off the smallest debt as you move to the big ones. Financial gurus say that this will give you the motivation that you really need as you will be able to see the debt burden decreasing and you will be optimistic that you can also clear the rest. Another thing is that keep your old accounts up and running so that your credit scores go up as they say old is gold. One simply goes up their financial mountain using fractions in that they will use two thirds of their income to deal with the debts and the remainder for savings.

 

Where there is a will there is a way

Not many people believe that they can pay off debt and save at the same time but the truth of the matter is that anyone who wants to get out of their financial distress and experience financial freedom will truly find out that it is indeed possible. Being in debt is not a good thing because it actually affects how we live, work and relate. Some people run away from paying debt because they feel that they have nothing for themselves but when you get to know how to establish savings while also paying down debt, one will be okay and simply be enroute to great financial freedom. The last word is that if you do not want to sink in the same mud again then work on your savings and always pay in cash, that way you will be free.