Loans are an integral part of life. Almost everyone uses loans several times in their lives. Proper conduct is the key to getting good loans, meeting repayments and quickly repaying debt.
One of the most common mistakes in the field is taking an immediate loan at high interest rates in order to pay another loan. It is worthwhile to take out a loan for the purpose of paying an existing loan only when the terms of the new loan are better in terms of interest and the spread of the refunds.
The most important thing to know about loans is that each loan should be returned with interest. Interest is the amount that we have to pay for the right to use the money we do not have.
Today, almost everyone can get an immediate loan at the bank, credit card companies and private financing frameworks. The ease with which loans that can be obtained creates recklessness and frivolity that has no place in financial management. Loans are taken only when there is a clear plan and the ability to pay the repayment, so long as you know how and whether you will be able to pay the repayment, you will not take loans.
Loans in small amounts is another common mistake.
It is easier to take a loan in the amount of NIS 5,000 than NIS 10,000 or NIS 20,000. Most people take loans of NIS 5,000 without thinking twice. They take one loan and another one after a few months. When the returns become a burden, they take a third and fourth loan. These small amounts connect to significant amounts. Each loan starts with forethought and financial planning even when this is a loan of NIS 1,000.
The equation is very simple. In order to pay the loan without harming the standard of living, you must increase your income. You will be amazed at how easily you can do this. It’s time to find out about a few extra hours at the workplace or more work of distributing newspapers, babysitting and more.
There is no doubt that you will prefer to spend your leisure time at rest. However, when the economic situation is urgent and you accept an immediate loan, you have a responsibility to bear the payments. After a long period of time, you will be able to fully redeem the loan and return to enjoy your leisure time.
If you are unable to increase your income, you will have to cut costs in all areas. It’s time to look for a cheaper supermarket and go shopping for groceries online. It’s time to start saving electricity and water, save fuel, exchange expensive meals at restaurants with coupons and discounts.