11/21/2014 01:53 pm ET Updated Dec 06, 2017

11 Habits of Debt-Free Happy People


Having good financial habits can keep you debt-free and happy.

How do I know this? Because I've been immersed in the health and wellness and personal development world for a few years and learned that good habits formed early in life can serve you now and in the future.

For example, if your parents lived within their means, they most likely passed this habit onto you. If your parents viewed money an exchange of something for value, i.e., you're perform a certain job at a company, they probably passed this habit onto you.

Throughout all of my research and study, I've learned there are certain habits debt-free happy people seem to have mastered. They either learned them from someone else or on their own. Keep in mind that all of us may slip up and do the opposite of one or more of these habits.

The key is to notice when you're off track with your finances and to get back on track.

Here are the 11 Habits of Debt-Free Happy People.

You don't live beyond your means.

Debt-free happy people don't live beyond their means and aren't stressed out and worried about how they'll pay your bills. Most debt-free happy people aren't impulse buyers; they think about if they need something, not if they want it.

You don't loan money.

It's okay to want to help people in a time of need. However, those who are debt-free know that constantly loaning family and friends money helps them to develop bad money habits. It's better to allow people to help themselves so they learn their money lessons.

You pay more than the minimum balance on credit cards or pay them off completely.

Paying more on your minimum balance or paying it in full keeps your credit in good standing with your credit card companies. Those who only pay the minimum balance end up paying more; interest and fees add up.

You understand that your debt won't magically disappear.

People who think their debt will magically disappear (although there's talk in the U.S. about forgiving student loan debt) are living in a fairy tale. Debt doesn't go away with a wave of a magic wand. Debt-free happy people take responsibility for their debts and pay them, no matter what.

You focus on abundance rather than debt.

Many spiritual experts believe that what you focus on expands. Therefore, if you focus on your debt, you may attract more of it to you. Those who are debt-free don't focus on debt -- they focus on abundance and prosperity.

You pay with cash whenever possible.

Paying for cash guarantees that you won't go into credit card debt. You won't stress each month about paying your credit card bills. Those who always use their credit cards incur more debt and dig themselves into a deeper financial hole.

You don't keep up with everyone.

Happy debt-free people know who they are and don't care who owns the latest car or gadget. They don't feel the need to impress those around them. On the other hand, people who feel they have to keep up appearances increase their debt and stress.

You save a specific amount of money each month.

People who are debt free save a specific amount of money each month; it may be direct deposited into a separate savings account. The extra cash can be used for emergencies or a splurge, like a vacation. If you don't save money each month, you may not have the ability to pay for unexpected expenses.

You understand the importance of investments.

Investing is a great way to build your personal finances. Working with a financial advisor can help you to grow a retirement or college fund. People who don't invest may find that they can't help their kids pay for college or won't have enough to live on should they retire.

You surround yourself with successful people

Successful people surround themselves with other successful people. They learn and grow by watching and listening to others who've built multi-million dollar businesses. Or maybe the people they associate with have climbed the corporate ladder and now call the shots. People Jim Rohn once said, "You are the average of the five people you spend the most time with." If you're in debt, chances are the people around you are too.

You read about personal finances

Debt-free happy people educate themselves about personal finances. They read books, magazines, and newspapers. They also take classes and courses. They watch financial programs and listen to financial radio new programs. Some people who are in debt aren't interested in learning about personal finances.

No one is perfect. We've all may have faced debt at one point or another. The key is to recognize bad money habits and replace them with good money habits. This is why debt-free people are often times happier than most. They learn all they can about personal finance and don't let money control their lives. If they slip and fall, they dust themselves off, and get back up again and tackle their finances.

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