Everyone knows that debt is far from ideal. When left unchecked, it can cause a spiral that’s hard to escape from, resulting in serious consequences for your future. Sometimes, however, it’s simply unavoidable.
How do you avoid falling victim to loan sharks or payday lenders who often have crazy interest rates and unfavorable repayment terms? Consider these financing options instead:
Low Or No Interest Options
While getting a loan without paying ridiculous amounts of interest may seem harder than finding a needle in a haystack, it can actually be done; if you know where to look, that is. In fact, if you fit the criteria, it may even be possible to get a place in a no interest loan scheme. This should always be your first point of call if you need money in a pinch because schemes like this carry a far lower risk of ballooning your debt than traditional borrowing options.
In some cases, you may be able to get an advance on your regular pay. The ability to do this will depend on your relationship with your employer, but if you’re chasing short term cash and can tweak your budget to fit in with your next pay cycle, this option is a great way to avoid creating or increasing debt. In some areas, this is also possible with social security payments, so regardless of your circumstances, there’s a chance you may be able to tide yourself over.
While credit cards should always be approached with caution, they can provide a good short term solution if you can trust yourself to use one responsibly. Focus on selecting a card that has low fees and a long interest-free period, and never use it for any amount that you can’t pay off before this grace period ends.
If your issue has arisen because you already have an unsustainable level of debt, switching up the way you manage your payments may free up enough cash to save you from sinking deeper. Even if you cannot reap any immediate benefits, sorting out the right debt management solution for your situation will benefit you in the long run and help you avoid ending up in such a tight situation again.
Interest-Free Store Finance
If times are tough but you absolutely need to have an item right now, it may be worth looking into whether any of your local stores offer interest-free finance on the product. Although you will end up paying more than the item is worth due to establishment and management fees, the difference between the item’s value and your out of pocket expense will be far lower than if you were to purchase it with nearly any other finance option.
Note: If you choose to go this route, you will need to ensure that your budget allows you to make all payments for the period of the contract on time. Many stores charge nasty fees for late or missed payments and may even repossess the item, so it’s important to be sure you can stay on top of things.
There’s no shame in needing a little bit of help every once in a while, so you shouldn’t feel bad if finance is a necessity in your current situation. What you should do, however, is ensure that you’re choosing an option that carries the least risk possible. The options outlined here aren’t your only ones, but they are some of the safest when used correctly. Think carefully before entering into any sort of contract, and look after yourself. Good luck.