Eliminate debt - Did you know that approximately 43% of Americans spend more money than they make? When you combine this statistic with the fact that the average American household carried $8,000 worth of credit card debt alone and perhaps you will begin to see just how much of a problem debt is in this country. Debt is so easy and so appealing. Most of us cannot go a week without being solicited by mail to open a credit account with this provider or that provider. It is easy to fall back on a line of credit during tough times. However the reality of the situation is that when you spend money that you do not have, you are going to have to pay the price. That price is interest payments. The average credit card interest rate is currently between 16% and 18%. This is a nearly a fifth of the total amount borrowed being accrued on a monthly basis. Those who are unaware of their interest rates or simply neglect the fact that interest rates can rapidly grow to the point where loans are needed to pay off loans, are the ones who need a serious lesson in being money smart. Debt is a downward spiral leading to nothing but bankruptcy and foreclosure if you are not able to get on top of the sums that you owe. Doing such things as making more than one payment a month or choosing a shorter term for your loan can dramatically reduce the amount of interest that you pay and get you out of debt faster. There are many strategies for eliminating debt but the one thing that they all have in common is paying off the debt that you owe as quickly as possible while at the same time avoiding the accrual of any new debt. Remember that only perhaps with the exception of buying a home, if you do not have the money to spend on a purchase you should not be making that purchase.

Reduce expenditures - Being money smart also entails keeping as much money as possible. You cannot be money smart if you squander all that you have and have none left over to save, pay off debt with or invest for the future. Reducing expenditures will require some attention to details such as sale prices, generic brands, etc. that you may not have thought about previously. It also means conserving energy used in your house to reduce the cost of utilities. Simple things such as buying a more efficient air conditioning unit or turning the temperature down a few degrees on the hot water heater can save you hundreds of dollars every year. Not to mention it is friendlier for the environment.

Save - Sometimes saving money in order to be money smart must be achieved by thinking of savings as a necessary expense. If you wait for a time when you will end the month with extra money in your pocket before contributing to a savings account, it is almost guaranteed that the savings account will remain empty or have such an inconsequential amount in it that you will never be able to actually use your savings account for anything worthwhile. You must exercise self control and determine what percentage of your income you will contribute to savings and then dedicate yourself to making that contribution every month without fail.