Should the Old Proverb Stand True – Never a Borrower nor a Lender be….?

In the old days we may have often heard the proverb ‘never a borrower or a lender be’ and it is easy to see why this could be a good thing in many circumstances. Borrowing money is expensive and if you get too many debts they can pile up and get out of control and it can be very difficult to get out of the situation again. Lending money can also be difficult if the person does not pay back and you get short of money. However, this attitude could also hold us back in some circumstances.

If we never borrowed money, most people would not be able to afford to go to university or to buy a house. This would mean that they would continue to live in rented accommodation and may not be able to get such a highly paid job. Therefore deciding not to get this sort of loan could be restricting. However, there are many types of loans which can get us into trouble. Unpaid credit cards, overdrafts, personal loans and similar can be a problem for some people. If they build up so much that they cannot be repaid or it is a struggle to make the repayments then they can be extremely stressful and cause all sorts of financial problems as well.It can therefore be a big decision to make, as to whether you want to borrow any money. You need to think about whether you need the money, whether it is the right time for you to borrow, whether you can afford the repayments both now and in the future and whether you will be able to cope with the stress of being in debt. This therefore needs to be thought hard about. If you do decide to borrow then it is important to compare different types of borrowing so that you can see which one looks to be the best for you. Compare on price, but also look at other features as well such as how good the customer service seems to be, what the reputation of the lender is like and how flexible the loan is. You may want the option of being able to pay it back early, make overpayments and skipping payments and you need to check whether the loan you are getting has these options. These could make it more expensive though and so you need to decide which is most important for you.

Lending is something that many people do not do. However, some people will lend to their family and friends if they ask them to. There are also possibilities for investors to lend money to businesses, either directly or through peer to peer lending. This type of investment can be quite risky, but some peer to peer lending companies will let you choose how much risk you are willing to take and will pay you a lower return on lower risk and a higher return on high risk investments. Lending to friends and family is very different and the reason some people do try to avoid it is because of the potential problems that can go with it.

Sometimes lending like this is fine. You give someone some money and when they have enough they will pay you back. It could be a causal arrangement that suits both of you. If it is a relatively small amount of money, then it is unlikely to be too much of a problem. Even if it takes a long time to be repaid or is not repaid, if it is a small amount of money, it will not be too much of a big deal. However it could be difficult if they keep coming back and asking to borrow more money and you do not want to keep letting them have it or they want large amounts which you do not want to give them. They might get annoyed with you and it could cause problems between you. It can be even more difficult if someone borrows a large amount of money and does not pay it back. You may need the money back or at least want some of it and they do not have it to give you then they will not be able to repay it when you need it. You could make things easier by agreeing a formal repayment plan that is affordable for them and suits you, but even then, they could decide not to stick to it and this could be a problem.

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Top Tips on paying back your Overdraft Fast!

Being overdrawn in your bank can be stressful, especially if you are not sure when the next chunk of money is coming in to pay it off. You may worry that if you do not have some money to cover it soon, that you will end up paying huge amount of interest and charges.

There are two types of overdrafts, an authorised overdraft and an unauthorised overdraft. Your bank or building society may call them different things, but essentially one you arrange with them and one you don’t. Although both will cost money, an authorised overdraft will be cheaper, it is likely to have a lower interest rate and may not have any charges. An unauthorised overdraft is anything over what you have arranged with the lender and this will have a higher interest rate and it will have charges. There could be a one off charge and there may be a daily charge as well. This can be one of the most expensive ways to borrow money, which is why it is wise to pay it back as soon as you can.

If you have any savings or money in any other accounts, then use this to pay off the overdraft. It can be hard using savings for this as you may have worked hard to get them and be saving up for something specific. However, it will be much cheaper for you in the long run and without such high overdraft fees you will be able to afford to save up again in the future.

Most people with an overdraft are unlikely to have savings and so things can be more difficult. However, there are still things that you can try. If you have a job where you are paid regularly, then it could be worth asking for an advance on your salary. Some companies, particularly large ones will help you by doing this for you.

Another idea is to try to do some extra work. You may find that your employer may be able to give you some extra work but this may get you the money quickly enough. It can be worth discussing it with them though as you never know what might come of it. You could look for some work extra to what you do in your regular job. Do check with your employer though as some will restrict the types do things that you do and some will not allow it at all. You may be able to find some work using the skills that you have, perhaps an evening job or a weekend job could help. However, if you need the money quickly then you need something that you will give you cash fast. You could find a cash in hand job or something like waitressing or bar work that will give you tips that you could pay into your bank. Another way to get some money quickly is to do some online work. There are scams out there, but there are some genuine opportunities as well and so it is wise to do your research before taking on any work. Read reviews, chat to other people, look on message boards and forums that you trust to find out more about the websites and companies.

Another way to make some quick cash is to sell things that you have but no longer want or need. Many people have clothes that they no longer wear, items they no longer use, gifts that they did not want or things like this that they could consider selling to make some money. Depending on the types of items that you have for sale you could use social media pages, auction websites, or you could sell offline to friends or at a sale.

Borrowing money from other sources could be a possibility as well. This may sound odd, but an overdraft is a really expensive way to borrow money and so if you can find a different way to do it which is cheaper then although you will still have a debt, you could pay less for it. Do check the costs of the debt not just comparing the interest rates but looking at the whole cost over the term of the loan. This is because the longer you take to repay, the more expensive it will be and there may also be additional charges. A credit union could be a good place to go if you want to borrow a fairly small amount of money and feel that perhaps other lenders would not help.

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Should I Borrow Money to pay my Insurance?

Insurance is something that we may have to have, such as for our car or home, or something that we choose to give us peace of mind such as contents or pet insurance. It can be an expensive thing to buy and so we may feel that we will only be able to afford it if we borrow money to pay it.

Some insurance policies come with an option of either paying in a lump sum or in instalments. The instalment option can often be more expensive because the insurance company will charge more if you pay this way. It is worth calculating how much extra this will be, if you are offered this option. It could even be considered to be a form of credit as they are letting you spread the payments and charging you for the privilege. It might be that there are cheaper ways to pay it than this, it could be that you borrow money from somewhere else to make it cheaper. You may also find that you do not have the option to pay monthly and you need to find a lump sum, that perhaps you cannot afford to pay for all in one go.

Insurance is something that we take out just in case we need it. We can never be sure whether we will need to make a claim but it can be extremely helpful at times. If our car is stolen, for example, the insurance will give us the money to replace it. Knowing that we have that cover can be very reassuring and it can mean that we can replace things or do repairs that we would otherwise not be able to afford to do. Therefore insurance can be a really important thing to have, although there may be some types that you do not think are worth it for you.

It is good to start by making sure that you really do need the insurance and specifically the type of cover that you are being offered. You may find that there are lots of options on the insurance and you need to think through whether you really need all of the cover or whether you can save some money by going for something which is slightly cheaper or whether you in fact, need the insurance at all. It is a very personal decision and will depend on what you own and how much risk you are prepared to take as well as what you can afford.

Borrowing money for anything should be something which you really think hard about. You need to not only consider whether you make a good use of the money that you are borrowing but you also need to think about whether you will be able to manage the repayments. It is easy to assume that you will but sensible to work out whether you will actually have enough money to pay it and consider what might happen if your expenses go up or your income goes down and how well you will cope with that.

It is wise to compare the cost of different types of loans to see which will be the cheapest for you to use. It could be that a credit card might be the most convenient, but they can be a problem if you do not pay them off for a long time as they are expensive. Personal loans may be for more money than you need, so you need to be careful that you are not borrowing much more than you need and therefore paying out more than necessary. Payday loans may seem like a good option but they are very expensive and they only lend you money for a very short term. You may be better off going to a credit union for them money.

Whether you borrow money or not will depend on whether you think that the insurance is worth the extra cost that borrowing will be. Only you know whether it will be worth it for you and if you have no other option but to borrow. If you do borrow then it is important to research different ways to borrow and find the best possible way for you.

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