Considering using a loan for the holidays?

The holidays are a time for fun, family and the most importantly enjoying great food! However, there’s also the slightly more intimidating “f” – finances.

The festive season is here and many families may be wondering how they can afford to make their celebrations as memorable as possible without over stretching the budget a little over December and January.

Luckily, as you plan how to best manage your expenses and get back to reality in January, loans can provide an affordable answer, ensuring that higher than average festive spending doesn’t mean you’ll be struggling for the whole of January!

What types of loans are available?

Alfred Ramosedi, African Bank Group Executive: Sales and Marketing, says while many people may think that a loan is only something to consider when you have large expenses, like buying a house, starting a business or having to subsidise school tuition – this definitely isn’t the case.

“Taking out a loan responsibly can help you to simplify your credit and debt,” explains Ramosedi.

He says one of the benefits of a personal loan is that you can select either a short or long repayment period.

“So if you just need a tiny cash injection to tide you over, you can plan to have this all repaid within three months, but if you need a larger loan you can plan to pay this back over a longer period.”

Debt consolidation loans can also be a useful solution if you’re struggling to keep track of your existing debt as it is spread across multiple sources.

“It is a particularly useful option if you want to get a better interest rate, or are struggling to meet the minimum monthly payments, which is common with short term debt. Your bank will settle your debt and you will then repay them, meaning you will make only one monthly payment to the bank itself – often at a more favourable interest rate. This can afford you greater flexibility, simplicity and a better rate.”

What can loans finance?

Loans can be used to finance almost anything. They are not recommended for consumptive spending however.

One of the most common uses of loans over the festive period is travel – whether that’s taking the dream holiday down to the coast or flying your parents up for a week so that they can see the grandkids and join in the festivities.

“Because we understand that the festive season can be quite tight and stressful, it is worth looking out for what deals are available. It’s important to manage your money effectively and spend sensibly on the things that matter most!” concludes Ramosedi.

Do you perhaps have more information pertaining to this story? Email us at randfonteinherald@caxton.co.za (remember to include your contact details) or phone us on 011 693 3671.

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