![]() If you are able to pay off your item within this interest free period, then these deals are also worth looking at. Some companies will also offer interest free periods, normally between one and three years. Even saving half and borrowing half is a better alternative. If the bank does turn you down, it might be because they think you’ll struggle with the payments – so consider saving for something if you don’t need it right away. Banks often have deals for financially strapped students needing cash for stuff like a bond when moving into a new flat at short notice. What are the alternatives? At the very least, go to your bank and try to get a bank loan first. The constant and expensive repayments could stop you from doing fun things, saving and buying other stuff you actually do need in the future. Do you really need it, or do you just want it without having to wait? Think carefully before committing to years of debt. Minimum payments will hardly cover the interest, meaning you’ll be paying off your purchase for years and pay stacks more than the ticket price. So for example, an interest rate of 25% per annum (year) when you borrowed $1000 would be $250 per year on top of that $1000 until it’s paid back. That means that you they charge you a certain percentage of how much money you borrowed or your purchase price on top of your borrowing. Finance companies and hire purchase deals make money by having high interest rates. This may seem like a sweet deal, but as they say, if it sounds too good to be true, it probably is! Finance companies take advantage of this pressure and offer to “help” by lending you as much money as you want, when you want it. More than ever, we’re under pressure to have the “right” stuff. Don’t buy into the pressure – literally. How much money do you put aside for the movies? Can you instead watch more d.v.d’s? For example, how much do you put aside for buying your lunch or buying takeaways? Can you instead make your lunches and cook dinners more often and instead, put this money away each pay. To make sure there is money in this account, think about where you can cut back from. ![]() ![]() Having a separate account for these expenses too can be really helpful. The real stress of money comes from those extra surprise costs, like car repairs, A & E bills, medicines, computer and phone repairs or clothing items for a job interview or one-off occasion. For this account, don’t get an EFTPOS card, since you can set up an automatic payment, where the money gets transferred out automatically. That way, you don’t have to remember to transfer the money every payday yourself, and you know that your bills will always be taken care of. You can organise for your bank to automatically put an amount of money you choose into this bills account every time you get paid. Once you have worked out how much money you need to put aside to cover all your bills (including rent, power, water, phone and internet), set up a bills account at your bank. One wicked website that’ll do this for you is Even if you want to do the maths yourself, have a look at the site – they list expenses you might not think to include. Add up all your income and expenses to see how much you realistically need each week for different things, where you are over-spending and can cut back.
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