Are you in a situation where you are considering taking or have already taken out a loan? Then it is always good to think about how you intend to repay your loan. Many Danes fall in when it comes to repaying their loans. It can be much more expensive than initially expected. Lucesfi has put together four good tips to repay your loan.
1. Plan your repayment
Most importantly, plan the repayment before taking out a loan. Immediately give you an overview of how much income and how much expense you have the month after you want to take out the loan. Non-repayment matures for a maximum of 30 days, after which you will have to pay high interest on your loan if you cannot repay it. Therefore, remember to be realistic in your calculations so that you can comply with the plan. The best way to calculate its availability is to deduct all fixed expenses from your income. Fixed expenses include, for example, your rent, electricity, water, heating, internet, mobile subscription, insurance and so on.
After looking at your income and expenses, and then figuring out your available amount, you should find out what proportion of the available amount you can realistically use to repay your loan. For example, if you have an available amount of USD 7,000 that month, you should not pay more than USD 3,000-4,000 per month. month to your creditor. Therefore, make sure that you can pay it all back the month after you take out a quick loan.
2. Set budgets
Budgets help you keep track of your money and what you spend them on. Setting a budget is not exactly something that everyone thinks is exciting, but once it is put in place and you make sure to follow it, it can help you identify where you are spending “no matter” money. Here’s how to save them from spending on more important things. Maybe try setting a cafe, food or clothing budget and identify bad habits. For example, do you buy two coffees a week, eat lunch out or something else? A quick calculation shows that you can save over 5,000 a year if you drop the weekly to-go coffees.
3. Create one or more additional revenue
There are many good opportunities to generate extra income that many do not immediately think about. If you can make an extra income to increase your available amount, it will allow you to pay off your loan on a monthly or all your installment loan on time.
There are several ways you can earn yourself extra income:
– Sell out of your clothes, furniture, books, etc.
– Take a part-time or weekend job
– Rent out a room or offer a lift via. Go more
– Think about whether you have some skills you can take money for; if you can for example a language you can translate, you can make graphics or similar it will also be a good opportunity to earn a little extra.
Over the last few years we have been given more and more opportunities to buy and sell used items over the internet. At the same time, the sharing economy has taken a major step forward in the public and will be an area of great focus and potential in the future. Sites like GoMore and Air BnB have made it easier and smarter to share expenses – and in some cases make a nice amount of money. Likewise, it is now also possible to get extra small income through platforms or sites where you can be a driver, where you can offer your help for example gardening earn a little extra on it. In these ways, you can provide a relatively quick extra income.
4. Lower your expenses
Many people often forget to look through their personal finances to understand what they are spending their money on and how to cut certain expenses from each month. In addition to generating extra income, you can increase your availability just by lowering your expenses. For example, you can do this by:
– Review your subscriptions (internet, TV, mobile, etc.)
– Drop the overseas holiday.
– Cut down on city tours, café, restaurant and cinema visits.
– Change insurance company.
While there are many points that are not fun to cut, you may need to lower your spending for a while so that you can repay your loan. Bad habits, like spending money on going to a cafe, can be huge costs and are not something you always notice costing a lot of money.
At the same time, you can, for example, save money by checking your needs and comparing prices on everything from broadband solutions to insurance and switching to the cheapest alternative that exactly meets your needs.