If you have not been careful about your Spending for the past few years, you may be startled by how much debt you have when you review your finances. Some kinds of debt, such as those for school and new cars, are common to have and are unavoidable for the average person. Others result from unplanned events such as medical emergencies or natural disasters. However, you can take steps to have less debt in the future from avoidable expenses.

Understand Where Your Money Goes

Either on your own or with the help of a professional such as Rescue One Financial, find out where all of the Money that you make goes. Your bank stores every transaction you make with a credit card, but if you pay with cash it may be harder to track your purchases. Compare how much you are spending on necessary items such as food and heating to how much you are paying for things that you really don’t need, such as movies and dinners at restaurants.

Understand What Spending You Can Decrease

Once you know how you are spending your money, you can decide how you will manage it to prevent future debts. Perhaps you will always brew coffee before you leave for work, or perhaps you will decide that buying coffee is a treat you will continue to allow yourself. Either approach is fine as long as you find a balance that works for your income.

Understand Your New Budget

Set limits for yourself with a detailed budget, which can be based on percentages of your income or dollar amounts, and enforce them by keeping track of them. Make a habit of asking for your receipt so that you have a physical reminder of the money you spend. As soon as possible, write down the amount either in a notebook, online document or phone app.

Financial worries are not fun, but you can take these simple, common-sense steps to make them easier to handle.

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