Living comfortably in the lifestyle you desire can be done without acquiring an overbearing amount of debt. The reality is that with a few simple alterations in both your habits and your mindset, you will be able to have a comfortable life with the things most important to you.

The most important way to maintain a debt-free lifestyle is as fundamental as it sounds: do not take on debt. If you cannot afford something, do not purchase it. Save up or, for larger ticket items, be patient and make economic decisions that are balanced with your needs and wants. However, there are times when even the most well thought out plan does not allow you to save enough money.

In a situation that requires you to take on debt to make a purchase, be wise and plan ahead. This requires that you look at different financing instruments. Should you use a credit card, get a loan from a bank, put down a security deposit? This choice will be driven by your ability to pay off the debt.

Credit cards: If the purchase is something that you are able to pay off quickly in the short term, and you have the credit limit available, a credit card may be your best option. Remember, credit cards typically have higher rates because they provide you with direct access to credit. The important piece here is that you pay off the balance of the card before any interest accrues, which means, essentially, you have an interest-free loan.

Avoid recurring transactions:  A perfect example of this is payments for a car loan or lease. These agreements create a financial obligation that typically last five years. With a lease, you never own an asset and if you need a car after five years, you are still stuck purchasing one. Many times people cannot afford the full price of a car, so a loan is a must. In this case, buy something used that gets the job done. In other words, a reliable, safe, and acceptable vehicle that can transport you from point A to point B. When possible, make extra payments on the car because that amount will go toward interest and help you pay off the car sooner.

Cut out service transactions: Some of the services you can cast a more cost-critical eye are cell phone bills, cable TV, internet, Netflix, Amazon Prime, or an entire myriad of services. These types of charges sneak up on you if you are not careful. Alone, each service may only be a few dollars, so they seem quite reasonable. When taken as a sum, you can see how quickly you are wasting your money.

Create a cushion: Create a savings plan that will enable you to weather not only tough times but also unintended decreases in your cash flow. Having a reserve will enable you to avoid taking on debt in order to meet your obligations when life events, like losing a job or confronting unexpected health issues, impact your life.

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