Debt is bad. In the financial world debt is called a liability. When you have debt, not only do you owe what the item you bought cost, you also owe interest for borrowing that money. The average Annual Percentage Rate for a consumer credit card is 13.37%. For example you have $2,000 on your Star Card and you make a minimum payment of $32 a month. It will take you nine years, and cost you a total of $3448.87 to eliminate that debt, and that is assuming you have not made any late payments, and you do not use the card for anymore purchases. That is $1448.87 paid in interest that could have been making money for you. So how do you eliminate your debt?
It's simple. Spend less than you make. Living below your means is the most important step when it comes to saving money. Here are a few tips.
1. Eat at the Chow hall. Even if you are not a Meal Card holder.
2. If the Chow Hall's five star cuisine is too much for, you pack a lunch.
3. Make all your large purchases at the P.X. You will save hundreds of dollars in sales tax.
4. Ask for a Military discount everywhere you go.
5. Find out who in your unit lives close, and carpool to work.
There are hundreds of ways to save money. All you have to do is look at what you spend money on, make the necessary sacrifices, and pay off that debt.