The Reason We Need to know about Loan Interest Rate

Many people around the world use loan facilities.  This might be with their bank or another financial institution, and could be a long-term loan or a short-term “payday” loan in order to deal with immediate financial obligations.

There are a number of factors to consider whenever you take out a loan of any description. One of the biggest can be the interest rate – the rate at which you pay to borrow the money. Worryingly, many people don’t even consider their loan interest rate, or whether it is fixed or variable.

Why Interest Matters

The biggest irony about people not looking at interest rates when they take out a loan is that, if they were opening a savings account, then they would probably be highly interested in the rate at which interest is added.

The most important thing about an interest rate is the way in which it can make repayment periods longer. This is a difficult balance to achieve when taking out a loan. Do you go opt for paying less money per month, but more over the longer-term owing to the interest rate increasing the cost of borrowing the longer you borrow for?

This is an especially important consideration if your loan is variable rate. Although most personal loans are fixed rate, many companies do still offer variable rate loans as it enables them to attract customers with what appear to be competitive interest rates. For example, a variable rate loan might be sold to you on the assumption that the interest rate, and therefore your repayments, will remain at a consistent level, even though the company may know themselves that the rate is likely to increase. To make these offers look even better, things such as the first three or six months at a fixed rate, or even no payments during that time, are often made available.

Problems with Ignoring Interest

Whether unaware of interest because you don’t know how finance works, or because you signed up to a loan and forgot about payments – this can happen if you have a direct debit close to your pay date, the money is never there so you don’t miss it – you could be faced with a problem.
The obvious one is that if you have a variable rate loan, your payments may increase. This is the sort of problem that most look when taking out a loan and think, “I’ll cross that bridge when I come to it,” often out of their desperate need for a loan at the time.

However, if loan repayments were right on the cusp of what you could afford already, you’ll find yourself missing payments, which then sees further charges and interest added, quickly getting you to the point where you’re going to be making repayments for much longer than you initially planned.

Be Aware

Whatever your reason for taking out a loan, be sure that you are clear on what the interest rate means, how it is applied, and your own capabilities for repaying the loan itself.

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Good to try Gold Investment

As we approach the end of 2013 and set our sights on another prosperous 12 months, many US residents are looking towards making sound investments to ensure their savings are completely secure and most importantly; out of the banking system. When Lehman Brothers collapsed in 2008, millions of us started panicking about whether our hard earned money was being looked after properly, and the shocking revelations that have since followed have only served to heighten concerns. This is why we all need to start looking towards alternative methods of keeping our savings intact until the time comes to utilise them, and is also the main reason I’ve written this article today.

Anyone reading this will more than $10,000 in the bank should seriously consider investing in gold because you really never know what’s around the corner. If hundreds of multinational corporations can disappear overnight, so can your meager rainy day fund, which is why there has never been a better time to start looking at the options available and working out which is most viable for you. With that in mind, have a quick read through the rest of this post, and I’ll try to fill you in on everything you need to know about putting your money into this precious metal.

Gold Is Desirable

Unless our country suffers a major EMP attack or famine, the chances are you’ll never be short of buyers if you have gold to sell. For thousands of years, this substance has lured the rich and famous into parting with their money, and this is unlikely to change anytime soon due to the sheer abundance of wealth within the top 1% of our society.

Gold Holds Value Well

Prices fluctuate over time in any market, but this tends not to affect gold on such a large scale. Although the metal you buy probably won’t keep a constant value forever, it does a lot better than most other products and has been steadily increasing in price since time began (with some dips every now and again obviously). Purchasing through a reputable firm like Regal Assets is probably your best move, as they are trained professionals who’ve been keeping their clients happy for years.

Gold Is A Universal Commodity

Yet another benefit to putting your savings in gold coins or bullion is that buyers will come from every corner of the earth. Gold is as desirable to people in Russia or Iran as it is back at home in the US, which also means that your wealth will be secured, even if the US dollar collapses completely. I hope you realize that your money won’t be worth the paper it’s printed on if this happens, whereas gold will still be as valuable as ever, if not, even more so.

So there you have it guys! Those are the main reasons why leaving your savings sitting in a bank account at this time is a very bad idea indeed, and why investing it in gold could ensure you retain the wealth for as long as you need to.

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Debt Solution

Sometimes, the level of debt we are in can spiral out of control. It’s easy to obtain credit these days; credit cards are thrown at us the minute we turn 18 and payday loans are only a text away.

But paying back these loans is a lot more difficult that getting them. Sometimes people have manageable debt and are able to keep it under control, which is great. But if your debt is out of control and you hide under the kitchen table every time there is a knock at the door, what are the solutions open to you?

One solution is to call your creditors. Make a list of all the people you owe money to. If you can’t remember all the debts you have, apply for an Experian credit report. It’s free when you have one on a trial basis, and it will show you exactly who you owe money to. Once you have found this out, sit down and work out how much you can realistically afford to pay back. Don’t be tempted to offer more than you can afford – if you don’t keep up with a payment agreement, the creditors are less likely to accept another agreement and you might find that you’re in a worse position than when you started.

If the creditors are not helpful, and don’t want to accept the repayment terms you have offered, perhaps it is time to think about a trust deed. A trust deed is a government backed program which will liaise with your creditors, getting them off your back and freezing the interest on your accounts while arranging a repayment schedule with you to pay back all the money you owe, usually over a period of 3 years. Check out trust deeds for more details, plus the pro’s and con’s of taking out a legally binding trust deed. Although it’s not an ideal solution, for some it can be the difference between a life in debt and a life debt free.

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Ways to get rids of your creadit cards

Credit cards can be extremely useful, especially if you have to meet certain unexpected costs (such as a medical bill or a car repair). However, many people out there often exceed the amount of money they can afford to eventually pay off for their credit card loan.

If you are among these people, you are most likely thinking of methods to relieve yourself from the burden the credit card debt has brought into your life.

The first thing to do is quite obvious, actually. You should ask for your credit report and see how much you have to pay back for your loan. Then, you should sit down and establish a monthly budget that will allow you to pay off the loan as soon as possible.

Try to see which the things on which you are spending the largest sum of money are. Decide whether they are actually necessary or not. If they are not, you should definitely leave them behind you in order to save money you can use to pay your credit card.

Also, talk to your lender and see if they couldn’t offer a better repayment program for you. If you have been good with your payments up to the moment, it is quite likely that they will be able to decrease the interest rate on your credit card.

If you have more than one credit card, remember to start paying the loan with the highest interest rates first. Each month, put into that account as much as possible, while paying only the necessary for the other accounts. This way, you will relieve yourself from the heaviest burden first and it will motivate you to zero out the other credit cards as well.

Furthermore, remember to try to save some money for emergency situations as well. Otherwise, you may end up where it all started: relying on your credit card and eventually getting into deeper debt. Realize the fact that you cannot plan everything ahead, so be prepared in case an unexpected bill hits you.

The most important thing is to keep yourself motivated and focused. Print out a spreadsheet with your debts and stick it somewhere you can actually see it every day. Living on a tight budget can be difficult, so remember to allow some money (little as it may be) for entertainment as well. If you don’t allow yourself to have some fun too, your depressive state of mind will eventually stop you from keeping yourself determined to pay off your credit card debt.

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How to Borrow Money Wisely

Borrowing money can be a solution to various financial situations but utilising credit effectively involves understanding your income and consequently knowing when it’s the right time to borrow money. Not every situation needs to be resolved with credit but when you do choose this option it should be directly beneficial to you and your finances.

Types of credit

Using credit may be common but that doesn’t mean there is only one type available. Banks and other creditors offer large scale loans, often with a specified purpose in mind, while smaller short-term borrowing is typically designed for emergencies.

Alongside cash loans, credit cards offer rolling credit agreements to allow small amounts of borrowing to be made more frequently over a longer time period. You can research credit cards online easily and efficiently and the results generated will prove just how useful these products can be.
Understand your income

The key part of borrowing money is being able to pay it back. As such, it helps to have a deep understanding of your income and this includes knowing how much spare income is available each month as well as how much can be freed up with budgeting.

These two figures give you a rough area of how much you can afford to borrow. Any more than this and you may struggle to pay it back – leaving you in further financial difficulty.

With credit cards, many of them won’t charge you interest if you pay off the balance on time and that means understanding your credit limits is vital. If you know you can afford to borrow (and repay) ?200 then your credit card becomes a vital payment tool that bolsters your credit rating.

Knowing when to borrow

Evaluating your budget may be relatively easy but how do you know when to borrow money? Typically there are two instances when you borrow money – to fund a larger purchase via small payments distributed over a long time period or to make purchases you can afford now but delay payment to improve your credit rating and add security to your purchase.

The first of these options typically involves loans and can be for products or services ranging in size. The latter is more aimed at credit cards where purchases are protected, making them an attractive option.
When deciding if now is the right time for you to borrow money the most important thing you should look at is whether you can afford it. Borrowing responsibly is the key to staying on top of your finances and irresponsible borrowing where you are surviving off of credit is never advised.

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How To Open New Bussiness

There are plenty of risks to starting your own business, and this does put a lot of people off. However, there are those that go for it anyway. In fact, some say that starting your own business will put you in a far better position than working for someone else, particularly during the economic struggle. Of course there are plenty of risks, as the countries state reflects directly on your business, but there are ways to get around it.

t’s no secret that a lot of start-up businesses fail; actually it’s suggested that 95% of them do. Before you start a business you should decide there and then whether you’ll be a part of this extremely high percentage, or if you’ll be one of the few that really makes it. This scarily high number should not put anybody off pursuing their own business. Success comes from hard work and being in the right place at the right time. The most successful people will make insane choices and come out on top.

Understandably if you have a family, or just don’t want to take the chance of losing everything you currently have, it may be better to stick to the day job. However, if you are one of these people, it’s clear you do not truly believe in your business idea. This is what it comes down to, if you don’t believe and feel determination, your potential customers won’t either. It’s a two way street.

Let’s take a look at the other risks in life. As a matter of fact, your 9 to 5 job is also very risky. As previously mentioned, the economic situation in Britain has caused thousands of companies to let go of staff. What would you do if this happened? Starting up your business and running your business is solely down to you, your future is entirely in your hands. See, both have risks! You’re just led into a false sense of security of what is the safe option and what isn’t. If you want to start a business, you should go ahead and do it, there’s no time like the present!

There’s plenty of help you can receive when starting up a business. No matter what industry you want to go into, there are advice centres and accountants that will assist you with your hotel business loan, restaurant loan or any other additional credit you may need.

You’ll be able to talk to other people in a similar position and communicate with those that faced the same fear you have, but still went on and succeeded anyway.

It’s important not to analyse the amount of failed businesses. It’s just a statistic and doesn’t give you the details of how it failed, or if they moved on to do something else, or if they changed their idea. One of the most important things to remember is that the majority of that supposed 95% will not regret a thing. It’s best to jump into the deep end, leave behind everything that keeps you ‘safe’ and go for the dream. It’s best to have tried and failed, than not tried at all.

Remember, failure is a word that can bring hope. You will definitely have learnt something through your experience of setting up a new business, and you’ll be able to apply everything you now know into a new venture.
Just go for it!

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