So you’re in the red. The bills are not closing and the notes seem to have fled from your wallet.
Undoubtedly, you are in a time that requires a lot of dedication and planning. But when you leave home, you are faced with an ample supply of easy money and you are tempted to get into the first financial and get out there with the amount you need quickly. Sounds tempting, does not it?
But is the loan the best solution for you to have your bills up to date again? Check out the steps below to evaluate whether applying for a loan is even the best alternative for your case:
Why do you need the money?
People think of borrowing for a variety of reasons: to pay for unexpected expenses, such as a car repair or a medical bill; to help in a month when bills do not close or even fund a vacation trip.
The first step in evaluating whether you really need a loan is to reflect on the reason. Unexpected expenses – which you do not have enough capital to cover – may be a reason to seek a loan. A vacation trip, for example, is not an emergency. It’s best to procrastinate, start pooling money, and only travel when you have enough of your own resources. There’s no fun to make up for the interest you’ll pay!
Do you have any option to get extra money?
In certain situations it is more advantageous to dispose of a good, such as a car, jewelry and even an apartment to pay off a debt than to get into another, acquiring a loan. It is better to sell something, pay off your debts and stay in the blue than keep the good.
Are you in debt? Analyze whether it is worth exchanging them for the new loan
For people who have very high interest debts such as credit card and overdraft and have no good to dispose of it may be a good option to apply for a loan that, depending on the model, may charge lower interest.
Opt for payroll deduction, whose discount is done directly on the payroll, or negotiate directly with your bank, which can offer friendlier rates.
Make a simulation before hiring the service
If you have come to the conclusion that the loan is the best outlet for your situation be sure to do a simulation before hiring the service. Analyze how much time you will need to pay the amount and not divide more than necessary. The higher the number of installments, the higher the interest you will have to pay. Do not hesitate to research and seek the best rates with different banks and financial institutions.
Avoid borrowing often
The loan is an alternative to solve an urgent problem. In no way should the service be used on a recurring basis to supplement the family’s income. Do a financial planning, anticipating saving even a small part of what you earn for emergencies. When you have a reservation, you do not have to resort to the alternative of borrowing money from banks and financial institutions, paying much higher interest rates.
Having a healthy and organized financial life is up to you. Do not wait!
Is that you? Have you put your finances in the day before checking the need for a loan? Tell your experiences.