10 qualities of debt-free people

Whether you have resolved to become debt-free, or if you still have a long way to go, it is always good to remain inspired. A look at the people you know are already having debt-free lives is a good way to stay motivated. It could be a friend, a family member or a co-worker - the person who you are thinking of would probably share similar qualities with others who are debt free. Here are 10 of the common characteristics that debt free people have.

1. They are attentive to detail

You may not notice that recurring fee chargedon your credit card for that gym you've already stopped going to if you do not check your statement regularly. Those who have no debtactually monitor their personal finances regularly and closely. Hence, they are less likely to throw money away by forgetting about their payment due dates or othersimilar fees.

You can also start paying more attention. The key here is just to start. Start by checking and examining your credit card statements each month. Then, start to monitor all of your spending. And then, add up your income. By comparing your expenses and earnings, you can see where you can cut back.

2. They know each of their stuff

Debt-free people conduct their own research. They mayemploy an accountant, but they don’t just send over paperwork or mindlessly sign their taxes unless they take a look at the documents. If you want better control over your finances, then you need to understand about them. It may sometimesfeel overwhelming; however the sense of security that understanding provides will soon outweigh the discomfort.

3. They believe they make less

Even if you may already be deep in debt, you can begin to make improvements to your situation by changing the way you look at the money you make and have. Imagine that you make about 10%, 30% or even 50% less than you actually do. Set up your budget around this figure. It may seem impossible at first, but little cuts to your spending could end up saving you much more.

Debt-free people are able to live on less than the money they make. This allows them to keep money aside for a house, retirement or an emergency fund.  This greatly provides a financial independence that gives you more options in the future.

4. They think about the long term

If you stop focusing on your immediate gratification, it can enable you to make smarter decisions. Granted, it would have been nice to have this season’s hottest clothes, but will they actually help your long-term financial goals? This does not actually mean you can’t buy shoes ever though – what it just means is that you have to first save up before buying them. Further, the waiting time also gives you the opportunity to reconsider if you even need and really like such purchases.

5. They aren’t afraid to speak up

Seek help. Ask if there are lower interest rates.Seek for forgiveness if you make one late payment. Debt-free people take full control of their finances and they are notmild and meek about it. If you know somebody who has achieved a financial milestone you also want for yourself (say, saving $1 million towards retirement, purchased a car in cash), then go ahead and ask how they did it.

6. They never fail to save

Regardless if it is a significant bonus or just a $25 additional from Grandpa, you should always think first of paying yourself. This holds true for your regular pay checktoo. Just as rent and mortgage are part of your monthly must-pays, treat your savings account the same way as well. Make savinga habit. Much better, is if you make it an effortless habit through automatic deposit. Debt-free people are aware that adding even the smallest of amounts now will lead to more financial freedom later.

7. They set realistic goals

You will find that it is easier to put aside money once you have a strong sense of where it is going to. This works for those times you are saving up for that pair of shoes, when you’re planning a vacation or if you’re already thinking about retirement. Debt-free people make specific goals so they have a picture of what they are striving for. This greatly helps you stay on track with your journey.

8. They know when to say no

You may receivemany tempting offers within the week for lunch with your colleagues or catch up dinner with your college friends. With these, don’t be afraid to say no if you feel appropriate. Debt-free people are conscious that saying no to these smaller expenses can help add up to big savings. Butthis doesn’t mean that you can’t have any fun at all. Consider hostinga potluck dinner instead of going to the new yet expensive restaurant across the building. You can also meet up with your friends in the park for a walk or run, instead of having to take an expensive gym membership.

9. They know the value of theirmoney

Debt-free people know the value of that single bill… because they actually see it! It is rather easy to overspend when you don’t seeactual money. Paying with cash makes us feel that the transaction is actually happening and that we are losing money for it. Furthermore, once that cash is gone, it’s really gone. It is advisable to try using only cash for a whole week or two and see how this changes your attitude on purchasing.

10. They value experiences more over stuff

Debt-free people don’t focus on things. They put more value on experiences than getting their hands on the latest things. Most of us will list our family and friends on the people and things they value. But are your financial choices reflective of that? If you are working additional hours to pay for that fancy meal with you wanted with your family, think about the tradeoffs. Is it really about the meal, or just about spending time with your family?

To become free of debt, you will have to shed plenty of your current habits that could be detrimental to your financial health, and take on new, more constructive ones. By thinking about debt-free people as your inspiration, then you could also be one step closing to living a debt-free life yourself.