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How to create good money habits to get out of debt

Your daily money habits can play a crucial role in paying off your debt
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Set yourself up for financial success. Photo by iStock.

What kind of money habits do you have?

Are you in the routine of paying your bills on time and ensuring you pay down debt? Or do you whip out your credit card for every impulse and only make the minimum payments?

When it comes to personal finance, building on good money habits is the key to setting yourself up for healthy, stress-free finances.

Here are some good money habits you can start working on today:

Prioritize your debt

How much money do you owe? How much interest are you paying on it? Focus on paying down your existing debt today and make a habit of not spending more than you make.

Create a spending plan

Budgeting doesn’t have to be complicated. iCASH, a fast and secure Canadian online personal loan provider, has a host of financial literacy resources, including a budgeting guide.

Their suggestion? Harness the power of the 50/30/20 rule to align your expenditure and saving goals. In a nutshell, the budgeting technique advocates setting limits on spending your after-tax income in three categories: 50% to needs such as housing expenses, 30% to wants such as entertainment, and 20% toward savings.

Build an emergency fund

Saving money can help you avoid debt long-term. Put aside money every month into an emergency savings fund for a rainy day. Next time you’re faced with an emergency vet bill or car troubles, you’ll have something in the bank earmarked just for that.

Keep an eye on your bank account

Do you avoid looking at your credit card bill? Do you know how much you get paid every month? Make sure you keep on top of where your money is going so you know you’re staying on track with your financial goals.

Set financial goals for yourself

Maybe you’re saving for a down payment on a house or a fantastic vacation. Maybe you want to be debt free. Implementing a budget and good money habits are easier to enforce when you know what you’re working toward. Set a goal for yourself and see how your money can work for you.

To get more information about iCASH, a safe Canadian direct lender that provides instant online loans, visit iCASH website.