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6 Effective Hacks for Getting and Managing Your Loans

6 Effective Hacks for Getting and Managing Your Loans

A loan can help you greatly in many situations, both personal and business related. However, not managing your credit wisely is a sure way to bankruptcy and a variety of other problems. If you want to avoid them, you need to know the best ways to get a good deal on a loan and have a strategy of repaying it in the most effective manner.

Hack #1: Look for Loans Outside of Banks

Big banks offer a high level of stability, which is important for financing. However, in many situations, you can find a better loan deal elsewhere. As getting a low rate is one of the most important things to consider when searching for funds, you need to research all your options first.

Financing sources to explore include:

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You also need to look into both national and local financial organizations.

Hack #2: Reduce Your Debt by Consolidating Loans

If you have several outstanding loans, you should look into consolidation options available to you. You can try to do this on your own or seek professional assistance. The latter would be preferable as an expert would be able to help you choose the best option for your current financial situation.

Transferring your debt balances is a very good idea if you have an opportunity to pay off your loans in a short period of time. This way, you might be able to get a much lower rate.

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Hack #3: Choose The Most Suitable Offer

A personal or business loan calculator is the most helpful tool for finding a great financing deal. Considering the number of financial organizations available today, comparing their offers individually will save a great amount of time and effort.

With the right software solution, you will be able to find and analyze a great number of loans. Most importantly, you will see not only the interest rate but the actual price of the loan.

There are dozens of factors that must be considered when choosing a financing option, and in some cases, a seemingly good deal will have extra costs that will make it expensive in the long run. If you aren’t a financial pro or have much experience in the matter, you’ll be hard pressed in understanding all the relevant details. Specialized calculators will do this work for you. This is especially important for business loans that are more complicated by default.

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Hack #4: Automate Your Monthly Payments

One of the main rules of effective debt management is to pay your bills very month. Making even the minimal payment is paramount for maintaining financial stability, especially when you have loans to pay off.

Don’t allow yourself to miss a payment by automating this process. There are a variety of banking apps that will allow you to develop payment schedules so that your bills are paid without your direct involvement. This automation system is one of the most popular services among mobile banking app users because it prevents from overspending and missing an important payment due to poor money management.

Hack #5: Prioritize Your Debts

If you have several debts and your financial situation is shaky, you may need to prioritize them. In this case, seeking professional advice would be best. A professional financier will be able to assess your balance and income, as well as predict the implications of defaulting on any of your current loans.

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Usually, the loan with the highest rate gets priority, closely followed by the debt with the lowest balance.

Hack #6: Keep Your Positive Accounts Positive

When you are unable to keep up with your debt payments, you should focus on keeping any positive accounts you have in good standing. Pay off the past due accounts when you have a chance, but do your best to preserve any positive credit you have left.

How to Stay Out of the Deep Water with Your Debt

Today you can get a loan for almost anything, but this kind of financial freedom makes many people a bit reckless with their funds. If you want to avoid financial problems, you need to manage your debts very carefully.

First of all, you need to get the best loan deals you can find. After you get the money, you need to plan your budget carefully and keep up with monthly payments. When the situation gets too difficult for you to control, seek professional counsel.

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Last Updated on March 4, 2019

How to Use Credit Cards While Staying Out of Debt

How to Use Credit Cards While Staying Out of Debt

Many people will suggest that the best thing to do with your credit cards during these tough economic times is to cut them up with a pair of scissors. Indeed, if you are already in huge debt, you probably should stop using them and begin a payback strategy immediately. However, if you are not currently in trouble with your credit cards, there are wise ways to use them.

I happen to really love my credit cards so I will share with you my approach to how I use mine without getting into deep financial trouble.

Ever since about 1983 when I got my first Visa card, I continue to charge as many of my purchases as possible on credit. Everything from gas, groceries and monthly payments for services like my cable and home security monitoring are charged on credit. Despite my heavy usage, I have maintained the joy of never paying any interest fees at all on any of my credit cards.

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Here are some tips on how best to use your credit cards without falling into the trap of paying those nasty double-digit interest fees.

Do Not Treat Credit Cards as Your Funding Sources

Too many people treat their credit cards as funding sources for major purchases. Do not do this if you want to stay out of trouble. I use my credit cards as convenient financial instruments so I do not have to carry around much cash. In fact, I hate carrying cash, especially coins. When you buy things on credit, the purchases are clean and you will not get annoying coins back as change.

I do not rely on my Visa, MasterCard or American Express to fund any of my purchases, large or small. This brings me to my golden rule when it comes to whether I will pull out any of my credit cards either at a retail or online store.

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I never purchase anything with my credit cards if I do not have the actual cash on hand in my bank account.

If I really cannot pay for the item or service with cash that I already have at the bank, then I simply will not make the purchase. Remember, my credit cards are not used as funding sources. They are just convenient alternatives to actual cash in my pocket.

Make Sure to Always Pay Off Balances in Full Each Month

The next very important part of my overall strategy is to make absolutely sure that I pay the balances in full each and every month no matter how large they are. This should never be a problem if the cash has been budgeted for my purchases and secured in the bank. I have always paid my full balances each month ever since my very first credit card and this is why I never pay interest charges.

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Using Credit Cards with Rewards

Most of my credit cards are of the “no annual fees” type, including one MasterCard on a separate account I keep at home as a spare in case I lose my wallet or incur any fraudulent charges. However, I do use a main Visa card which does have an annual fee because all purchases on that card reward me with airline frequent flyer points. For me, the annual fee is worth it since I do travel and I get enough points to redeem many free flights.

You have to decide for yourself if you will charge enough purchases on credit each year without paying interest charges to warrant a credit card that rewards you with airline points (or other rewards). In my case, the answer is “yes” but that might not be the case for you.

I occasionally use a MasterCard or American Express card on small purchases just to keep those accounts active. Also, I have been to the odd retailer that accepted only a certain type of credit card, so I find that having one from each major company is quite handy. Aside from my main Visa card which earns the airline points, the rest of my cards are of the “no annual fees” variety.

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So this is how I use my credit cards without getting into any financial trouble with them. This strategy is recommended only if you are not in debt, of course. In fact, it is worth keeping in mind once you’re out of debt so that you can keep your credit cards active and treat them responsibly.

What are your credit card usage strategies? Let me know in the comments — I’d love to hear what methods you use.

Featured photo credit: Artem Bali via unsplash.com

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