Having debt is everyone’s nightmare. But planning your finances properly, can help in getting rid of debt easier.

When we hear about people who have become financially “successful,” the first thing that comes to mind is the professional support they have received to achieve it.

Although in many cases this may be the case, the truth is that in order to achieve financial stability, a good credit history and more positive things, it is enough to have some basic advice.

Financial stability is the sum of small actions that teach us to choose better when it comes to taking care of our finances.

If that is one of your goals for the long term, you should apply following three habits to achieve it.

3 habits that will help you when it comes to getting out of debt

1. Be smart when using credit card

It means paying for purchases and what you spend with your credit card in one installment the following month.

This will help you save on interest and improve your reputation with the bank. Timely payments and not extending them much, and also to be more aware when spending the credit card are the keys for improving the reputation. Financial experts around the world suggest not to spend more than 40%. Otherwise when paying in the following month, you will end up with an imbalance in your budget.

At this point you must remember that whatever you buy with your card, you have to pay for it.

However, there are exceptions in which you can defer payment in installments; the principal, when the payment you must make for purchases is very high and justified, for example, when you want to buy an appliance or a computer.

When opting for payment in installments, you must bear in mind that you cannot abuse them for interest either. Otherwise, you could end up paying more than what your purchase cost you.

Credit cards are a very useful financial tool. And besides being able to buy almost anything using the card, they are also very helpful when it comes to saving money.

One of the easiest ways to save money is through the discounts offered by the card.

In some cases, these can be 20%, 30% or even 40%. But it is important that in order to take advantage of them, defer your purchases to a single installment, otherwise, you will end up paying the money saved through the discount in the form of interest.

It is important to know the benefits of credit card according to your financial profile so that you can take advantage of them. For example, if you are a food lover and usually go to restaurants, you can ask for a credit card that offers discounts in restaurants.

Remember that before accepting a credit card/loan/insurance compare multiple alternatives and choose the one that offers you greater benefits and a lower interest rate when paying the installments.

2. Dare to look for better options

The financial world is constantly renewing itself. This means that from time to time, new financial alternatives and tools appear that you must take advantage of. For this, it is necessary to be attentive and compare the offerings of one entity with another.

For example, credit card. If there is one that suits you better, choose it. Some of the changes offered are: low interest rate, more benefits/cashbacks/reward points, among others.

The same is true if you’re thinking about applying for loan. You must remember that there are many banks you can approach and compare.

3. Plan your spending and annual goals

Planning is the main ally when it comes to healthy finances. Having goals for savings and expenses is a basic step that must be met.

To do this, you need to organize your monthly budget very well. And once you have defined all your expenses, you can set an amount to save. That way you will know, if you can go on vacation or buy something you want.

If your savings aren’t enough, remember that you can always resort to some kind of financing. If you’re in a hurry to get the money, an immediate loan wouldn’t be a bad idea. And it’s not that complicated these days, and paying them off on time can offer you some benefits.

While these types of loans are available to everyone because they’re so easy to access, it doesn’t mean we should use them at any time, since, as with any financial tool, they should be taken as one more responsibility.

If you are thinking of applying to lend money to someone else, make compulsive purchases, appear in front of friends or to spend on slot games and gambling, it is better to take several steps back and stop considering lending money from financial institutions for these reasons, as you run the risk of being seen as a bad customer.

Loans were created to give you financing at times when your budget is not enough for the plans you have. But that doesn’t mean you take loan for everything.

It depends on what you want the money for: a new car, a house, an emergency or even for some academic year you want to take, today’s credits are tailored to the needs of customers, so choosing the right one will offer you many benefits.

For example, a mortgage loan offers a different payment plan to that of a personal loan. Since in the first one, because it is a purchase of a home, you must make the payment of a down payment. On the other hand, with an auto loan, you can access benefits related to an auto insurance or others.

Remember that debt begins when you don’t know how to manage our finances. Starting with small actions, such as writing down the expenses made during the month and organizing and planning the budget taking into account the main expenses, income and financial goals is a fundamental step to achieve financial peace.

Author Bio:

Hi, I am Nikesh Mehta owner and writer of this site.

I’m an analytics professional and also love writing on finance and related industry. I’ve done online course in Financial Markets and Investment Strategy from Indian School of Business.

I can be reached at nikeshmehta@allonmoney.com. You may also visit my LinkedIn profile.