No one can say that he or she will never have problems with debt. People often get stuck in bad debt because of circumstances beyond their control like losing a job, divorce, sickness or a failed business.

Some people found themselves in huge debt problems because of poor financial management and uncontrolled spending.

Here are possible causes of debt that can happen to anyone who doesn’t take precautions.

Spending more than what you can afford.

How much have you been spending with your monthly allowance? Or do you literally spend all your income on bills and personal costs? This habit can put you at great risk and if you find yourself in the same situation, it’s time to change.

Not saving for the rainy day.

Do you set aside savings in the bank? Do you have an emergency fund? Unexpected expenses often come when you least expects them so it’s best to be prepared always.

Gambling and vices.

Do you find yourself gambling or spending your hard-earned money on bad habits? Many people lost control over their vices and ended up in bankruptcy. Some may even reason out that they’re gambling to solve their debt problems. But gambling or resorting to vices will never solve anything. These habits will only get you into more trouble and heartache.

Not budgeting money.

It’s easy to overspend when you’re not following a specific plan or budget. One effective way to deal with uncontrolled spending is to set a budget plan and strictly follow it.

Not obtaining an insurance coverage.

Medical bills and other emergency costs can put you in bad debt overnight. This is why financial experts recommend preparing for these emergencies before they happen. Aside from saving your own emergency fund, obtain insurance policies to protect you and your family.

Living beyond your standard.

Simple living is really the key to getting out of debt and staying out of it. Recognize the most important things in life and avoid the hype of advertisements.