These days there is a lot of profit to be made in lending, so borrowing money has become one of the easiest personal finance choices you can make. It makes no difference whether you can make your repayments or not -the lender always wins.
Alexandria Blaelock, author of Holistic Personal Finance: How to pay for the life you want argues “Borrowing money is spending bits of life you haven’t lived yet, and with easy access to credit cards and loans, you could be spending the rest of your life before you’ve lived it.”
Here are Blaelock’s tips for borrowing money:
- Remember Lenders Are Not Customer Service Organisations: Lenders let you borrow money because it’s an easy return for them. Not just because you are paying interest, but because you’ll get hooked on easy money and want more.
- Don’t Borrow Money for Crap: Purchases that bring short-term happiness and don’t increase your wealth will make you poorer. Chances are you will be paying for them long after the joy of owning them has faded.
- Know How Much You Owe: It’s really easy to make a succession of small purchases on a number of credit cards without noticing – opening your statements can be shocking. Tracking your spending, and knowing what you owe can help you keep your debt under control.
- Delay Purchases: Stores are carefully designed to overwhelm you with bright magical surroundings to reduce your ability to make reasoned purchase decisions. If you see something you absolutely must have, leave the store and wait 24 hours. If you still want it, go back and buy it.
- Return Unwanted Goods: How often have you bought something you regretted, yet never taken it back? And were you paying credit card interest on it as well? It can be inconvenient to make returns, but your debt will thank you.
Alexandria’s tips on borrowing money will help you reduce stress and gain control of your debt rather than it controlling you..
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