Paying off a personal loan.
While it can of course be understandable to take out a loan if you’re in dire straights and running out of options I really implore you to do everything in your power to avoid this. Take control of your finances and start forward planning an ’emergency account’ by garnishing your wages a little each month. I wish I had been doing this when I had to pay for emergency dental treatment. Of course I was in pain at the time and money didn’t matter to me at that point. But over the next few weeks I was enduring the pain of repaying with interest on money I’d only used a few days prior. As I said – plan ahead for these kind of scenarios if you have the money to spare from your wages. Put it into a decent savings account and let it do work for you!
Credit cards.
Credit cards are great. They make your wallet or purse light and easy to carry, they make buying things in shops and online an absolute breeze too. However these conveniences should not come at the expense of you throwing your hard earned cash into paying off ‘late payment fees’ if you happen to miss your monthly pay date. I have personally felt this burn twice, the second time I was livid because I swore I was never going to let it happen again however it can be become surprisingly easy to lose track of your expenses when you’re buying with plastic from the internet because a) you never have to physically hand over any cash so you don’t process the ‘spending’ in the same way, and b) your receipt from an online purchase is usually emailed to you, it’s not something you bother to print out, so it’s harder to keep track on when you are spending money that is no longer in your account. There’s no warning for when you go into negative balance on the credit card so your best bet is to establish a rigorous discipline about the date you make your repayment. I’m embarrassed to say that up until a few months ago I had no idea how to pay my credit card off online. I was registered with my bank for online use and I could see an option to transfer money from my credit card into my generic current account but not the other way around.
I had assumed for years this was some kind of ‘trick’ by the bank to make it more difficult for you to pay off your outstanding credit card payment and increase the likelihood of incurring a late payment fee. One day I got so fed up with this I phoned my bank to complain, only to have the gracious clerk inform me that it is in fact possible (and quite simple) to arrange a payment to my credit card across the internet. My mistake was that I was looking to transfer my cash from one account to another, but for some reason I was required to go into a separate part of the site and elect to ‘pay a bill’. Once I had this figured out it seemed quite obvious, but it alluded me for years, throughout this time I was always travelling in person to my bank and queuing with cash to lodge into my credit card account. This was normally quite a time consuming hassle, and while it is certainly no excuse for missing my repayment dates, it certainly becomes more understandable when you work a 9-5 job and the banks close at 4.30! So please, take my advice and learn how to do this online and on time!