Debt at Christmas
It’s that time of the year again, and now that the excitement of bonfires and fireworks has just about blown over, it’s time to think about the next big celebration, Christmas.
The big retail brands such as John Lewis and Boots have released the first big budget TV adverts, and soon we will be flooded with festive adverts coming at us from all angles. Every year we say to ourselves that we will prepare for next Christmas and start planning a little earlier than we did last year. Ideally it would be good to have started in the summer but life isn’t always that simple, so now is as good a time as any.
Prepare Your Personal Finances
The first step in preparing for any big event is to look at the personal finances and to plan what can be allocated towards celebrations and what needs to be set aside to ensure the essential things are covered such as bills, food and fuel to name a few.
Once you have put it all down on paper or on a spreadsheet, you can start to look at areas where you can spend your funds most effectively. However, if things are financially tight and you know that you will need additional funds, then now is the time to start thinking about where those funds might come from.
Credit Cards Are Great For Smaller Low Cost Items
In order to make sure you do not get to the middle of the holiday period and suddenly find yourself into an un-arranged overdraft, you should look at the credit card comparison websites for a good low interest credit card. They can be handy to spread the financial load for a few weeks until your next pay day, at which time you should pay them off or pay a sizeable amount towards them. Remember that the New Year is just around the corner and for those paid monthly, end of the month pay day is not that far away.
Personal Loans Are Better For Larger Amounts
If you have completed your festive budget and understand that you will need a larger amount than your overdraft or credit card will cover, then the next option you could explore is a personal loan. Personal loans are ideal for larger amounts (thousands rather than hundreds) and can be paid back over longer periods, usually between 1 and 5 years. These situations may arise if you have been planning to visit family for a well overdue Christmas catch up and require the funds to pay for airline tickets and travel insurance for instance.
To ensure your application will be accepted, you will need to know whether you have a good or a bad credit history, as this will have a significant bearing on whether you will be successful. Provided you have had a reasonably healthy bank account and have used credit related services to have created a credit footprint, then you have a good chance of receiving the funds you require.
Guarantor Loans Are Ideal For Larger Amounts If You Have Bad Credit
For those who already know that their credit history has had a few previous blemishes and will not qualify for a personal loan, the next option that could be investigated is a guarantor loan. A guarantor loan is almost identical to a personal loan except that the applicant will need someone to financially guarantee them. The person who agrees to be that guarantor, whether it’s a family member or a very close and trusted friend, will be responsible for making any payment which the applicant fails to make at the agreed times. If the original applicant does not keep up the repayments, the guarantor will then themselves be responsible directly for the loan and the repayments.
We hope that this helps you to understand a few more of your options as we close in on December, and if you would like to speak to someone about a personal loan or a guarantor loan then give us a call on 01225 941941 or simply click the ‘Get Started’ button.
Please remember that if you are in serious, unmanageable debt that you cannot see a way of dealing with, seek advice and help as quickly as possible. Free, confidential help is available from a number of sources, including National Debtline (nationaldebtline.org), Step Change (stepchange.org), Debt Advice Foundation (debtadvicefoundation.org) and Citizens Advice (citizensadvice.org.uk).