Spreading Christmas Costs With A Personal Loan

Spreading Christmas Costs With a​ Personal Loan
As the​ days grow shorter and the​ nights get colder,​ our thoughts might start turning towards festive matters .​
Christmas is​ coming,​ and while this should be a​ cause for excitement and anticipation of​ good family times,​ for many of​ us there's something less pleasurable on​ our minds at​ this time of​ year .​
The holiday season gets evermore expensive,​ and if​ money is​ already tight we might worry about how our finances will cope.
It's very common for people to​ use a​ credit card to​ cover the​ expenses of​ gifts,​ food,​ drinks and socialising,​ intending to​ pay off their indulgences in​ the​ New Year,​ but this kind of​ credit is​ fairly expensive - especially if​ your good intentions to​ repay early don't quite succeed and you​ end up carrying the​ debt for many months.
Another option is​ to​ make use of​ an​ overdraft facility at​ the​ bank,​ going 'into the​ red' over the​ holiday season .​
This is​ a​ convenient option,​ but it​ comes at​ a​ price - an​ overdraft is​ often expensive to​ maintain,​ with both a​ monthly fee and a​ percentage interest charge .​
This can make an​ overdraft almost expensive as​ a​ credit card.
There's also the​ danger that if​ you​ overdraw heavily on​ your account so that you're close to​ your limit,​ you're not leaving yourself much financial breathing space should an​ unexpected expense arrive in​ January .​
Besides that,​ once you've built up an​ overdraft it​ can be very hard to​ pull yourself back into the​ black,​ particularly if​ your normal budget leaves you​ with little spare cash each month.
So what's the​ solution to​ this? Are we doomed to​ a​ festive season of​ bread and water,​ alone and miserable? Well,​ maybe a​ personal loan could be the​ answer .​
Taking out a​ loan,​ if​ done thoughtfully and with a​ definite purpose in​ mind,​ can provide you​ with the​ funds you​ need to​ see you​ through the​ holidays without plunging you​ into penury for the​ rest of​ the​ year.
First of​ all,​ by shopping around you'll be able to​ take advantage of​ the​ intense competition between loan providers,​ and you​ should be able to​ get yourself credit at​ a​ much,​ much cheaper rate than that of​ a​ credit card or​ an​ overdraft .​
This means your monthly repayments can be smaller,​ or​ alternatively you​ can clear the​ debt much more quickly.
Secondly,​ a​ loan is​ usually arranged on​ a​ fixed rate basis,​ meaning that you'll know exactly how much you​ need to​ repay every month .​
This contrasts to​ the​ variable rates of​ credit cards and overdrafts,​ which can change from month to​ month,​ leaving you​ unsure in​ your budgetting.
Finally,​ a​ personal loan is​ most often repaid over a​ specified length of​ time,​ after which your debt has been cleared .​
With a​ credit card,​ it's tempting to​ just make the​ minimum repayments,​ which barely cover the​ interest charges,​ leaving the​ best part of​ your debt uncleared .​
This is​ a​ guaranteed way to​ enrich the​ card company while keeping the​ millstone of​ debt around your neck.
So is​ a​ personal loan the​ right solution for you? Credit should never be taken out without careful consideration of​ how it​ will affect your financial future,​ and it​ is​ of​ course better to​ live within your means if​ possible .​
However,​ if​ you​ decide that credit is​ the​ best way forward then a​ personal loan is​ often the​ cheapest and most effective option.
Spreading Christmas Costs With A Personal Loan Spreading Christmas Costs With A Personal Loan Reviewed by Henda Yesti on August 13, 2018 Rating: 5

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