The first rule of spending is to always spend less than you earn. The minute you start spending more than you’re taking in, you incur what is called negative margin or deficit. Deficit is different from a loan in that deficit adds continually to your debt and you are unable to pay it back. As you keep overspending each month, your debt just keeps growing and growing. Before long, you and your entire family will become a slave to it

The way to avoid debt and live within your means is to create a monthly budget with different categories for things like shelter, food, clothing, transportation, and so on. But simply creating a [tag]budget[/tag] won’t solve your financial problems. You have to stick to it. Be disciplined. When the money is gone from a certain category, that’s it until next month.

Don’t borrow against your future, because the future is always uncertain.

I would suggest that you visit my write-ups on [tag]finances[/tag] or read Stop The Money Leakages Now, Money Management Skills and Keep a Money Diary.

If you are already in debt, you will have to take this into consideration when you create your budget. There are plenty of actions you can take to reduce your debt, such as using some of your margin to pay it off, paying off your high interest loans first, consolidating all of your loans into a single, low interest, monthly payment, and simply learning how to delay gratification so you don’t get into this mess again.

It seems like incurring some debt is inevitable today, especially when it comes to purchasing costly items such as vehicles or a home. But I believe it is not always necessary, particularly for expendables, such as furniture, appliances, or electronic equipment. However, before you incur any debt of any size, spend time in prayer and evaluate the spiritual, economic, psychological and personal ramifications of that decision. If you stick to doing things on a cash-only basis, you may have to wait a little longer to purchase what you want, but it will definitely be worth it in the long run.

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