Yes, my friends, as one holiday ends the build up to another inevitably begins. That means one thing, it’s time for mistletoe and wine, or rather Christmas time! Unfortunately, Christmas is often just a tad more expensive compared with Halloween. What do you need to buy for Halloween? A bag of sweets and a few costumes. At Christmas, there’s the tree, decorations, food to feed the five thousand and…I feel like I’m missing something? Ah yes, the presents!
You might have already started buying your gifts, and you’re beginning to realize there’s a large cost here. At that point, you may think about ways to extend your income, and for some of us, this will mean borrowing. But before you go down that route, there are a few things you need to think about.
Do You Need To Borrow?
It’s a good question, and you might find you’re just taking the easy way out. Therefore, borrowing a loan should always be seen as a last resort. I know the pressure of Christmas because you want to make sure that you get the right presents for your kids. I get that, but you need to realize that lenders know about this pressure too. That’s why they often increase their marketing at this time of year, encouraging us to take the plunge. Don’t be fooled. They don’t care about whether you can afford to buy Pokemon Sun for your kid, they just want to make money.
Can You Afford It?
It seems odd thinking about a cost of borrowing when you’re borrowing in the first place because you’re low on cash. But when you’re borrowing you’ll be short on money in the short term. You need to think about the long term. Will you be able to pay off the loan in a few months? If the answer is yes and the interest rate isn’t too high, borrowing is an option. If the answer is no, don’t kid yourself into thinking you can push off paying it back, you can’t.
How’s Your Credit Score?
You may find that you can’t even get access to the type of loan you want. Unfortunately, it’s off limits because your credit score is low. Your credit score is calculated by your history of paying back debts and loans. If you constantly leave debts to grow, your credit score will be poor. You can use companies like Experian or My Credit Monitor to check your credit score. Compared to Experian, the latter might offer the better deal for their services. Either way, it is useful to stay on top of your score and know whether or not you are in the position to borrow.
Have You Found The Best Company
Finally, you need to think about where you’re borrowing the money from. You should research the market carefully looking for the best deal. There are plenty of companies online who will turn your Christmas shopping into a never ending debt spiral, so you need to be careful.
Borrowing can make sense for some individuals. But you do need to watch out for the common pitfalls associated with this method of extending your income.
I would advise no to anyone. IF you have to have a yardsale or sale something to cover xmas then do it!