Getting some form of credit or finance when you need it can be a positive thing, but it can also place extra pressure on you financially. You’ll need to learn how to manage a loan so you don’t find yourself in a tight spot.
In this post, we’ll take a look at some tips to manage your money while paying back a Personal Loan, so you can move forward with the confidence that you’ve got your finances under control.
First Up, You’ll Want To Create a Budget
Whether you already have a household budget or not, you’ll need to include your Personal Loan repayment and work out the rest of your finances to accommodate it. If your financial situation is really tight due to having to pay back the new debt, then you’ll want to trim back on any unnecessary or optional expenses, until either your financial situation improves, or you’ve repaid the loan in full.
When it comes to managing the financial affairs of the household, you should have a budget anyway; whether you’ve taken out a Personal Loan or not.
Make It a Focus To Always Pay Your Loan On Time
What you don’t want to end up with is a dent in your credit rating due to tardiness in repaying the new debt. Why not set up a reminder in your phone one or two days before the due date, so you have time to transfer the repayment. If you struggle to remember when bills are due, then it’ll be a wise idea to have the loan repayment automatically deducted from your account each month so you can’t forget it.
Some lenders will charge you a fee for a late payment too. You don’t want to end up spending more money than you have to, paying back your Personal Loan.
Find Ways To Make More Money
One sure way to make budgeting for and managing a new Personal Loan much easier is to increase your income somehow. This could come in the form of a second job, doing something where you can make money online (such as freelancing), asking your boss for a pay rise, selling off stuff you no longer need or any number of other ways that you can generate extra money, temporarily or permanently.
Don’t Waste Your Personal Loan Funds
If you took out a Personal Loan to fulfil a specific purpose, be sure to use the money for that purpose. For example, if you took out a loan to renovate your kitchen, avoid using this money to pay for new clothes or a TV upgrade. If the idea was simply to have some extra cash on hand, then spend the money wisely. Don’t just get yourself into debt because you feel like going on a shopping spree. When your money has dried up and if you have nothing to show for it, repaying your loan will always feel harder and more stressful.
If you have other debts in addition to your Personal Loan, such as credit cards, for example, you might want to consider applying for a Debt Consolidation Loan and rolling all of your debts into one easier to manage loan.
There are a number of advantages to doing this. First, you could reduce the amount you’ll be paying in interest on your debts. Secondly, the repayment amount for one loan is likely to be lower than the total you would have been paying each month on separate debts.
Debt consolidation makes perfect sense if you have two or more debts to repay.
Talk To a Private Lender About Personal Loans
The banks are not the only game in town when it comes to Personal Loans. Cashify is a private lender that specialises in fast approvals, competitive interest rates, instant* cash transfers and short-term loans. Talk to us today about how we can help you.
Disclaimer: Please note this content is of general nature only and does not take into account your personal objectives, financial situations or needs. For advice tailored to your financial situation, it is advised that you seek guidance from an accountant or financial advisor. The information contained in this article is correct at the date of publication.