Effectively Managing your Personal Finances

The increasing urge for people to purchase things they don’t really need have brought about the rise of over expenditure even for those average income earners. This has resulted with more and more people being debt burdened. The main reason for this is that individuals especially wage earners care very little when it comes to managing their finances not knowing that being able to properly control and manage their systems of BORROWING against what they earn can be financially advantageous for them.


Relationship between Borrowing and Personal Finance Management


Main sources of an individual’s additional financial resources (aside from wages and other incomes) are credit cards and other types of loan. Credit card is the simplest, easiest and most popular way of getting additional cash. But remember that each item bought through credit card will always be billed. So individuals should make it a habit of only using credit card as a last resort solution for additional expenditures. Always keep in mind that the use of credit card will only result to debt accumulation and as such will only worsen your debt problem. If it is really necessary for you to get a credit card, make sure you opt for a credit card provider that charges the lowest interest. Always remember that your interest expense must always remain low in order to balance your other expenses that need to be paid.


Debit Card, Personal Loans & Savings


Another way to manage your finances is to use debit cards. The use of debit card will restrict you to only use as much as what is stored in the debit card account. Debit cards will keep you away from overspending and the unnecessary accumulation of debt. Personal loan in Singapore is also another source of an individual’s finances. However, since this is borrowed money from an institution, make sure that the one you’re getting has the least interest and finance fees attached. Finally the best and most effective way to manage your finances is to save money. No matter how much you make, there will always be room to save. It is just a matter of balancing your income against your expenses and even a child can do that.

Where to Get the Best Deal on Personal Loans

No matter how financially sound you are right now; there will come a time in your life where you will be facing some kind of a financial problem. It may be for a needed medical procedure or a major home repair that needs to be done or any other expense that is not within your usual expenses. For this kind of emergencies, getting or applying for a payday loan in Singapore is one option that you can take. However before immediately BORROWING that money, you must first organize and plan on the how, where and when you’re going to apply for the loan.


Do Not Immediately go to a Bank


Economics 101 teaches us “get as much as you can but pay as little as possible to get it”. This rule also applies when borrowing money. The goal is to borrow as much as you can but find one that offers the least interest and charges. Banks are not usually like that. Because of the nature of their business, their interest rates especially on personal loans are usually not competitive. However, there are banks although rare that offer low interest rate so it is not a waste of time to also look around.


Credit Union; a Good Source for Loans


Your credit union is one of your best sources to file for a personal loan. Because they are a non-profit financial organization, they offer the least amount of interest and finance charges on loans.


Online shopping


The internet today is also a good source in finding where to get the best loan. Because of the increasing numbers of lenders online with hardly an overhead expense on their business, they can surely offer better loan deals than those you can find holding offices in buildings all over the city. However read reviews of the online lender before approaching one.



Peer-to-Peer Lending or Social Lending


Peer-to-Peer lending are provided by non-traditional money lender. Also known as social lending, they are quite popular nowadays because they can offer as low as 5% on interest charges depending on the loan amount and repayment terms.

Common Mistakes When Managing your Finances

BORROWING MONEY is usually the age old solutions of many when it comes to covering up expenses that can’t be paid. With a little understanding about money budgeting, balancing income and expenses and investing time to understand how your finances work is all one need to pull him out of repeatedly going to a MONEY LENDER to solve his expense problems. The following are just some of the common mistakes an individual should be aware and avoid when budgeting and controlling his finances.


Mistake #1: CREDIT and Credit Card to solve expense problems


It’s funny that when individuals discover that their expenses are more than what they make, the first solution is to borrow money to cover the expenses that cannot be paid. This is like putting out a fire with gasoline. Remember that frequent use of credit to cover expenses will only worsen your debt situation.


Mistake #2: Not Keeping Track of Daily Expenses


In order for a good budget to work, there is a need to tract daily expenses. This will help realize, where all the money is going and this is a good way to find a leak in your budget and find out where you and/or the family is overspending.


Mistake #3: No Savings is put aside


To most earners, savings is not a priority or if they ever do save, it is spent almost immediately. Savings should be a made a priority if you want your budget to work. Just think of it this way; consider saving as an expense that you would have to pay certain and specific amount each month and that same should have a payment terms of  say 24 months. If you will put aside about 5 to 10% of your earnings to savings, can you imagine how much you can save in 24 months?


Mistake #4: Juggling your Expense Money.


Never use your utility expense money or grocery money for other purposes like buying a new tire. Always make it a point to use the money for what it was originally intended for or you may just end up with higher credit balances.

Is There Really a Need for you to Borrow Money?

There really are times when people do something just for the sake of doing it and not because it matters to do it? This is also true when borrowing money either from friends, relatives, a MONEY LENDER and financial institutions. People sometimes borrow money but not really knowing whether it’s necessary or not. Before you even think of signing up for a CREDIT card or a loan, think deeply and see if there is really a need in getting a loan. Times today are really hard and even with substantial earnings, many are opting to pay and to finish up their current debt. Before you even decide to dive into the debt pool, try and figure out whether you should really be borrowing money for expenditures that might even be solved through other means.


Do you really need to Borrow?


Before applying for a loan, it would be best if you contemplate and first ask yourself these questions. First, “do I really need to borrow money and do I really need to spend it?” Second, “am I overlooking something about my finances or are there other ways to solve my financial problems?” And finally, “if I do borrow money, do I have the capacity to pay it on time?” the answer to these questions will give you a good idea on where you stand in your financial situation.


Is There a Need to Borrow so there is something to spend?


Some people borrow money without thinking thoroughly about it first. Sometimes the money they need is just to purchase something frivolous like luxury items and these are purchases that can really be put off until such time that there is a surplus at hand. Or if they really need the items badly there may be some other financial sources that they can find other than borrowing.


Decided you Want to Borrow Money After All


If you’ve decided you want to borrow money, it is important to plan and work out how you plan to pay it back. Make sure that your payment plan is realistic enough that you won’t fail in paying the loan. The most important thing when deciding on this factor is to know how to balance your monthly income with your current financial liabilities.

Strategies in Managing your Debts

People are now are starting to realize the pitfalls of having too much debt so many of them are trying to reverse the situation. Although it may take a while to be free of CREDIT liabilities, global debt situation (at least in the Northern Part of the Globe) is actually on the decline. The following are five important tips relative to Family debt Management.


Balance your Assets and Liabilities


This is a principle that most financial institutions live by. The idea here is to for your assets to be available at the opportune time that you will need them. No long term loan for some fixed assets like vehicles. Make sure they are paid within the allowed depreciative years or even earlier. An example of this is still paying amortization for a car which is already 10 years old. You should also try to avoid financing long term assets such as real estate properties with short term loan such as that from a credit card. This would only spell trouble for you later on.


Keep Money in the Bank


This may be quite traditional but it works. Liquidity saves you. If you have liquid lying around unexpected expenses can easily be controlled. If the liquid you have is not enough, at least BORROWING won’t be much of a problem considering that the loan you will need will be small thereby allowing you to have control in paying it back.


Replenish Your Savings and keep your debt to a minimal


Never used up all your savings. Have a plan on how you will return what you’ve gotten from your savings. Treat your savings as a place to get a loan. Make it a point to replenish what you get by amortizing what you get from it. Look at it this way; if you did not have any saving, you would have gone to a MONEY LENDER to borrow money and you would have to pay that back too. Do the same to what you will get from your savings. Debts are unavoidable monthly expense so keep them at bay. Remember that the larger your debt is the less flexibility you have.