Whilst being perfectly independent from a financial perspective is the ideal state to be in, the reality can often be a little different. Even if you are, more or less, financially independent, there are always unexpected emergencies and surprises that can appear when money is low and not everyone has spare money sitting in a savings account to cope with them.
With this in mind, where do you turn when you need more money in a hurry? There are various small expenses that can be seen as an emergency. A repair bill, or a broken down car, can have various consequences. Often, these could cause further damage if left unresolved or even affect your ability to get to work. In other cases, the argument can even be made that paying these off now is much better than the consequences for paying late, whether due to additional charges or simply high interest. In any of these circumstances, you can consider the likes of quick loans to provide a fast solution. If you’re financially smart, this shouldn’t be a major problem in the long run.
The risk of loans
All loans do, of course, carry a certain amount of risk. Taking the loan out isn’t the problem but you need to make sure you’re comfortable repaying the debt. Needless to say, incurring long-lasting debts will go against your financial independence.
Some quick sums and budgeting can easily determine this. The repayments need to be of an amount easily affordable from your income. In the case of a small, short-period loan, seeking specialist advice is a sensible idea for everyone.
If you borrow money within the region of £100-200, for instance, is this something you can easily pay off? A small amount might not worry you but letting that interest accrue is as risky as any other loan. If you can’t pay back a small amount straight away, what makes you think you can pay off a bigger amount later on?
Borrowing smartly
That said borrowing smartly can prove helpful and useful in the right circumstances. Compared to larger loans from major creditors, companies like Peachy lend small amounts online, so you’re not dealing with the larger repayment plans and interest. These small loans are often designed with a quick turnover in mind. You may have to reduce your disposable income for a short while but there are very few, if any, lingering side-effects if paid off quickly and efficiently.
Likewise, as someone seeking financial independence, this is one of the better ways to remain independent. You’re not risking collateral and you’re not risking any relationships with banks or companies through large, collected debts; the likes that can easily occur on larger loans and credit cards, for example.
I like the idea of borrowing smartly. Borrow the right money at the right time for the right needs.
Unfortunately too many people think it’s okay to borrow “just because”. And that’s why basically everyone is in debt…
Small amount is good for me.