The key to a healthy life is keeping the proper balance between duty and fun, a balance between income and expenses, and also between good and bad.
Many professional finance experts have suggested that paying off debt is the prime target to live a prosperous financial life. But, people often get confused when it comes to balance their debt and social life. Tell me one thing, isn't it always good to tackle your debts first?
1. Carry out your life and associated things
You might skip your normal things which include money to pay off your huge debts earlier. This is a quite fair decision, but you must be judgmental while skipping those things. This is a smart money move because a certain wrong decision may disbalance your funds.
You can , or you may skip one or two of them. The second option is maintaining your car and home all by yourself in a DIY way so that you can keep both of them in a good shape without hampering your finances and the debt payment schedule.
2. Create emergency fund
People belonging from different age groups must have emergency funds for any sudden financial crisis. If you are currently paying your full attention to reducing your debt amount, it’s advised that you may also need to .
If you don’t save enough amount for an emergency fund, then at the time of serious financial crisis, you may need to use your credit card or you may need to apply for a loan. In both the cases, you're stepping back from your current goal by increasing your total debts.
3. Prepare for retirement
Saving for your retirement fund is a wise decision. But, people often get confused that whether or not planning for retirement is a good idea while you have debts on your shoulders. Practically, it totally depends on how you are dealing with your present financial condition. If you have enough income to manage savings for retirement funds along with cutting off your monthly debt payments, you're good to go with both the options.
Normally, if you somehow manage to get your employer's contribution towards your retirement funds, things will get easier for you. So, you and your employer both will deposit the same amount each into your retirement fund investments. This’ll double your benefits and you can calmly engage your rest of the income toward paying off your debts.
But, as I said earlier, you can use this method only if you have sufficient earning capacity. You may start saving for retirement and paying off debts simultaneously, but you can't continue it if you lack a good income.
4. Investing in your health
Last but not the least, you must save money for investing toward your healthcare costs and doctor’s fees when you feel unwell. Don’t skip medical treatments and regular health care check-ups. Be careful while having strong medical drugs and sleeping pills, don’t skip them without consulting your doctor.
. It’s quite sure if you don’t stay fit, you can’t work properly to pay off your debts. So, do proper exercise, go to the gym. You may cut down your gym costs by joining a normal gym rather than an expensive one.
If you still think that gym subscription is hampering your budget, then you can jog or you can swim every morning to keep yourself fit. You can use a bicycle for going to different places and also to your office; it’ll also help to reduce your cost of transportation.