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13 Everyday Habits of Debt-Free People

Amanda Tarlton

Set goals

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Having a plan means having a purpose. "Americans that lead healthy financial lives more often than not have clear financial goals and are actively working towards them," says Yoni Dayan, Chief Editor of Money Under 30; he adds that "if you have a good why to save, the how will come much more naturally." Not sure where to start? These 19 personal finance tips you were never taught is probably a good place.

Wait to buy

"If you have trouble with impulse spending, waiting a few days is a great habit," Joe Udo of Retire By 40 explains. "You may find a lower price or simply realize that you don't need it after all." While this is particularly helpful when it comes to big-ticket items, like a new TV or even a new car, it can also apply to everyday buys that can add up over time. Psst: Here's an easy trick to avoid impulse purchases.

Turn off auto pay

Shannah Compton Game, a Certified Financial Planner and host of the Millennial Money Podcast, recommends removing all auto-pay or auto-fill options on sites where you shop frequently. This forces you to "think about how much money you're spending before you hit the "buy now" button," she says.

Pay as you go

Surprise parties are great. Surprise bills are not. To avoid owing at the end of the month, Erica Gellerman, creator of The Worth Project, suggests treating your credit card like a debit card. "For example, if I swipe on lunch for $10 and gas for $40 I'll use the credit card app on my phone that night to transfer $50 from my checking account," she explains. "That way I'm not spending money that I don't have."

Pre-pay your credit card

This tip from Compton Game is pure genius: "Pre-pay your credit card for however much you've budgeted for the week for your expenses," she advises. It will help keep your bank balance in check and stop you from spending money you don't have. Just make sure you never use your credit card to purchase these 10 things.

Don't carry a balance

There's a two-word reason: interest payments. Udo says that when he uses credit cards, "I always make sure to pay the bill in full every month. I get all the convenience without having to pay interest to the bank." If you can't pay it all, a good rule of thumb is to never carry more than 30 percent of your credit limit to the next month. Bonus: Paying off your balance every month is one of our top tips for boosting your credit score.

Use cash

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Another thing to consider if you find yourself holding a hefty credit card bill when the 31st rolls around, is to start paying with cash. Udo explains that not only does this make sure you're living within your means but "the physical action of handing over cash to someone else is a lot more difficult than swiping a card."

Automate your savings

Remembering to set aside money each month is tough. Fortunately, Sophia Bera, CFP and founder of Gen Y Planning, has a sneaky solution. "Automate your savings and retirement contributions so you don't have to think about it yet you're consistently making progress on your goals." An easy way to do that is with a savings app like Qapital or Digit.

Find inexpensive alternatives

More free time often involves spending more money, from brunch to happy hour to window shopping (which turns into actual shopping). "Nothing is wrong with these activities, but when I was doing them out of habit, I realized that so much of my spending was on things that I didn't really care that much about," Gellerman says. Now she keeps a list of budget-friendly activities to swap out for her pricier pastimes, like inviting friends over or going on a hike.

Have a good attitude

As New Age-y as it may sound, the law of attraction applies to money, too. The better your attitude is towards your finances, the better your finances will be. "Come at money from a place of enjoyment and abundance instead of fear or scarcity," Taylor Simpson, founder of The Money Mindset Masterclass and the Abundant Life Experience, says. "Know and believe money comes to you easily—when you feel this, you'll live it." One way to do that? Say "thank you" when you spend money to start seeing it as something that comes and goes effortlessly.

Create an emergency fund

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According to an annual GOBankingRates study, in 2017, 32 percent of Americans have nothing saved. Zilch. To prevent going into debt, however, you should have enough set aside that you could cover a minimum of three to six months worth of living expenses in case something drastic should happen. These top 8 tips from personal finance pros will help.

Don't boost your budget

No matter what. That means even if you get a raise, start a side gig or even win the lottery—stay firm to your original budget. Better yet, funnel all that extra income directly into your savings or retirement fund, so you won't even feel like you're missing anything. Want more ways to stash some cash without sacrificing your lifestyle? Here are 11 ridiculously easy tricks.

Skip Starbucks

Yes, you've heard it before but it bears repeating: Business Insider broke down exactly how much you'd save if you swapped your daily skim latte with home-brewed coffee—and it's a lot. Assuming you spend between $1 and $5 whenever you hit the drive-thru lane, you could be losing $1,200 per year compared to just $45 if you make it at home.