cash loans

There are now more options for sorting out our finances than ever before, but some of the classic choices remain the best. This is certainly the case with the good old fashioned personal loan. Here are three situations in which you can decide whether one of these is right for you.

Work Out How Much You Could Save

If you currently use a credit card or a store card, then you are probably paying a high rate of interest on it. The rates vary from one card to another, but in the US they are typically positioned between 7% and 36%. This means that in most cases it is an extremely expensive way of funding your purchases. In addition, if you pay off the minimum amount each month then all you are doing is paying a lot of interest and very slowly reducing the amount of capital owed. For example, if you owe $1,000 and the APR is 20%, then it would take you 9 years to pay it back with a minimum monthly repayment of $20. You can work this out using your own figures on the http://www.federalreserve.gov/creditcardcalculator website. By moving to a personal loan, you can pick an interest rate which is right for you and set about paying it back on a structured repayment plan which sees the amount reduce throughout the loan term.

Think About What You Want

Of course, there are also times when what we really want to do is treat ourselves to something extra special. As we have seen, credit cards are an expensive way of buying things but what if we really need and deserve a treat? Let’s look at the example of a vacation you are interested in. You have worked hard all year, and now you see that your savings aren’t going to be enough to let you get away for a couple of weeks on the beach. It is therefore a question of weighing up whether or not you would like to commit to paying back a reasonable amount each month in order to get that trip away you have dreaming about. Obviously, it isn’t good to give in to our desires every single time, but there may be occasions in which you think that it is definitely a good idea to borrow some money in order to do something exciting.

Put Your Finances in Order

It can be tough to control our finances now. We started off by mentioning the number of financial options now open to us, but this can sometimes lead to confusion more than anything else. For example, you might have a mortgage, a few credit cards, a small loan or two and then a bigger loan for your car. This can make it hard to budget each month, and sometimes it can be a good idea to simplify matters a little. If you are struggling to stay on top of all your different repayments then you might like to consider scooping a few of them up and covering them in a single personal loan. This will make your finances a lot clearer and simpler to manage, and it will most likely save you some cash each month as well.

If any of those situations sound familiar to you then it is probably time to find out how much you would need to borrow in order to improve your life a little.

Peter Coppola is a personal finance and insurance expert. He mainly writes for personal finance and insurance blogs. Click here to learn more about short term finance options.