Debt free people are not an urban myth. Do you notice that whenever you go out for dinner with friends there is always someone in the group who proactively volunteers to work out the bill and then hands over a wad of pristine notes, whilst everyone else dubiously wonders which credit card won’t be declined?
It is the adult version of the kid at school, who always handed their assignments in early. We may mock them, even secretly hate them, but when it comes to dealing with debt, it may make sense to look at this person and learn a few lessons in keeping solvent. So how do we spot them and what can they teach us?
1. They have a French accent
C’est vrai? Do debt free people really have a French accent? Actually that is not strictly true, but the French spend far less than most people on credit cards every year, only putting on average a mere $350 a year on plastic. In addition to this the average French person saves approximately 10% of their income. In contrast, Australians are making more frequent and larger transactions than a decade ago, with the average balance per card being around $3,147.
Lesson learned: Plastique is not so magnifique, therefore if your credit cards almost seem to itch when you leave the house, try to leave them at home. Paying in cash will always feel like you are spending a lot more because you are consciously handing over money so hopefully this will slow down any splurges. If you are struggling to control your cards, review your debt solutions and chat with us for debt help.
2. They do their homework
Like the person in your class at university, who rather nonchalantly dropped in conversation that not only had they already completed all their coursework, they had ran a quick marathon on route to handing it in, debt free people make the effort to go the extra mile. These people may still have an accountant, but they may know as much as him or her when it comes to balancing the books.
Lesson learned: Invest time into understanding your finances. If your finances are a mess, speak with us for debt advice. It may not make you a marathon runner, but it will give you a much greater sense of control about your own financial status.
3. They are responsible
Let’s talk about the dinner party again. There is always someone who enthusiastically suggests “let’s celebrate Tequila Tuesday!”, or “let’s head to the casino! Just for an hour. Or maybe two…” Chances are this is not the same person who volunteers to split the bill and then goes home on the bus at 10pm, who we discussed earlier. Yes, some may accuse the bill splitter of being boring, but at some point in your life it is time to grow up and take responsibility of your own financial situation, before you really damage your credit rating. Maturity doesn’t necessarily come with age, but you are never too old or young to start trying to put money aside.
Lesson learned: Even a small amount every month in savings or paying off loans early makes a huge difference long term. If you are unsure about how you stand from a credit rating perspective, My Credit File can give you some tangible answers.
4. They understand value
Most of us regularly look in our wardrobes and complain we have nothing to wear (and that includes guys too!). Wouldn’t it be smarter to have less clutter, but a few key items which have lasted for years? One of the habits of debt free people is they have a deep understanding of value and the phrase “less is more”.
Lesson learned: It is wise to use coupons or look out for special offers, but do not let shops trick you into spending more than you should, just to take advantage of a seemingly unique offer. If you are unsure, walk away for 24 hours and then see if you still think the item is a wardrobe essential.
5. They can say ‘no’
Many people find themselves in financial hot water due to impulsive behaviour. This could be offers that seem too good to be true at the mall, or even all those invitations to eat out with colleagues and mates on a school night. If you calculate the cost of several pub lunches or meals out per week, it soon makes a huge difference.
Lesson learned: If your impulsive behaviour feels like it sits deeper than the occasional spontaneous parmigiana, it is time to seek professional help. We can offer you confidential and constructive debt help services.
6. They tighten their belt – literally
Most people at some stage have had to really knuckle down and tighten their belt from a cash perspective. Sometimes budget cuts are just temporary, but if you get into good habits, such as packing your own lunch and cycling or walking to work every day, this could be the start of some very good long-term steps towards achieving your financial goals. Knowing how to live off less is an admirable skill and will certainly bring your stress levels down, a major factor in poor health and relationship difficulties. This could be the start of the new leaner you!
Lesson learned: Know the difference between wants and needs. By cutting back on the less important things, it is possible for anyone to get out of debt. If you don’t know where to start, speak to one of our expert consultants for an effective plan of action to manage your debts.
7. They are not materialistic
Finally, ever noticed how the most solvent people are not preoccupied with how much they would love those snakeskin Jimmy Choo shoes, or which car they would like to buy next? Financially astute people understand that experiences are more important than material goods and that people are more valuable than possessions. They also teach their children sound money habits from an early age, such as the value of earning pocket money and putting it aside for a really special milestone.
Lesson learned: Materialism can affect us all and it is easy to be pressured by our peer group or social media. Don’t be afraid to be an individual.
Summary of debt free people
There are many lessons that we can learn from debt free people. In general, they:
- minimise their credit card spend
- do their research
- behave sensibly
- look for value
- think before they spend
- try to save
- live a minimal live
Let’s take in some of the lessons they’ve learned so that we can develop some better money habits and live a debt free life.
If you’re seeking more serious debt help, we’re here to help you! Contact us today on 1300 368 322 to begin the conversation.