As soon as I realized that my personal financial picture was a little bleak, I started thinking about taking out a personal loan. I wasn't really looking forward to going into debt, but I knew that if I wanted to solve a few short-term problems, a loan would be the way to go. I talked with a few of my local financial institutions to get a good idea of what they could offer me, and then I sat down to go over the paperwork. It was incredible to see how much money I could save by securing a lower interest rate. Check out my blog for more information about loans.
Being a parent is challenging. Being a young, new parent is doubly so. So when a new parent finds themselves in need of financial assistance, how should they borrow that money? If you're not sure what the best route is, here are five valuable reasons to choose an installment loan over other options.
1. Installment Loans Are Stable.
If you opt to use a credit card, your payment will vary each month. It might suddenly grow if you miss a payment, send the payment late, or go over your credit limit. An installment loan, though, is a fixed rate — making budgeting much easier and more reliable.
2. You Don't Mix Family and Money.
Some young parents would be able to borrow money from the Bank of Mom and Dad or other relatives. However, caution should be used when borrowing from friends and family members. In doing so, you are intermingling a financial obligation with the existing personal relationship.
3. It Expands Your Credit History.
In order to qualify for better credit terms, larger credit lines, and more favorable rates, you'll need to establish a good credit score — usually by establishing a record of timely payments on a variety of different credit sources. An installment loan is an alternative credit source to credit cards, and it allows you an easy way to develop a good record over a year or more.
4. You Can't Charge It Up Again.
If you worry about borrowing money because you worry about falling into a debt trap, installment loans are the perfect solution. You borrow a set amount of money under a set, readable contract and fixed monthly payments. But you can't add more debt to the pile as you go. this means your payments will have a definite end date and the amount borrowed will decrease every single month.
5. You Set a Good Example.
Your kids will learn from what you do more than from what you say. If you want to raise them to be smart with money and use credit wisely, they need to see you doing so as well. Choosing a fixed installment loan over an easy but dangerous credit card sets a fine example. It also helps your child to see that while everyone may experience some financial difficulties, it is possible to find your way out with a good strategy.
As a parent, your financial choices have long-lasting consequences. But when you opt for a straight installment loan, those consequences will undoubtedly be more positive no matter what you face. Learn more by meeting with a lender in your area today.
Share15 May 2020
