- September 1, 2020
We all plan for managing our personal finances, but quite often we face particular exigencies due to which we have to change our financial planning. It could be due to a medical emergency, job loss, or an expensive buying. If you have savings, then you can sail through these situations else you are forced to take loans to finance the unplanned expenditure.
Getting a loan from a bank is not an easy task as it involves a lot of paperwork, credit checks and background verification. The interest cost on these loans is another strain on your budget. This is the reason why money managers and financial advisors recommend to have an emergency fund to deal with such crises.
Why Don’t You Go For An Alternative Source of Financing?
Banks in Ireland will straightaway reject your loan application if you have a substandard credit history of repayment. This rejection will further exacerbate your credit score.
Albeit, Irish people have a decent credit profile, but not everyone in the country is blessed to have one. To help these subprime borrowers, Ireland has many financing institutions now who look beyond your credit score for the lending decision. There are many options of lenders providing personal loans in Ireland to bad credit borrowers.
Why Should I Go For These Loans?
Mentioned below are some characteristics of taking these loans and why they are better than traditional loans from banks.
- You can get these loans even if you have a substandard credit score as these lenders assess your ability of repayment than your creditworthiness
- Paperwork is minimal, and there is an instant decision on your loan application that whether it is accepted or not. Every process is online
- There are no hidden charges or processing fees or penalties for late payment of instalments
- Easy repayment options of weekly or monthly instalments depending on your cash flow
- Interest rates (APR) on these loans will be higher compare to traditional loans as the risk associated with lending to such borrowers is also higher
- These lenders do not ask for any security (collateral) to be pledged against the loan or to produce any guarantor for the loan
- An advantage here is that if you meet your repayment schedule, then your credit score will start improving as these lenders report to Irish Credit Bureau
In a nutshell, this option of the quick loan in Ireland is ideal for subprime borrowers having poor credit profile when they need to finance an emergency or buy their dream car.
How Can You Manage Your Personal Finances in a Better Way?
There is no one size fits all personal finance mantra that applies to every individual. However, there are a few tips for better money management. These are listed below:
- Make a Budget: This is usually the first step in planning your finances and tracks all your expenditures. Ideally, this budgetary allocation should guide your spending decisions, and it also gives you a reality check about where your money is going. It helps you to cut down on expenditures which are not necessary and then prioritize the expenses based on the need. For instance: Cancel all subscriptions you hardly use, switch to a cheaper broadband plan, claim all deductions to reduce your income tax liability.
- Save & Invest: An important of your budget should be the savings column which will help you to tackle unforeseen circumstances. As the legendary investor Warren Buffett said, “Do not save what is left after spending, but spend what is left after saving.” These savings will also come handy post your retirement.
The savings should ideally be 15-20% of your salary, and as a practice, you should invest this amount in interest-earning assets. These assets can be Mutual Fund, Equity, Debt Instruments (Bonds), Fixed Deposit, Gold etc. It will help you to lock your money so that you don’t spend it and will also fetch returns for you, therefore, multiplying your savings.
- Avoid Debt: This is another gem of advice to keep your liability as low as possible by avoiding taking debt unless it’s a dire need. This is because you have to repay the loan amount with a hefty interest and a significant portion of your salary then goes towards instalments. There are personal loans for poor credit borrowers in Ireland. However, they should be avoided considering high-interest outgo every month.
Go for these loans only when you have a proper repayment roadmap for them. Even companies now are striving to become debt-free, why shouldn’t you? We hope this blog gave you some insights about how you can manage your finances and borrow money in case of an emergency or luxury spending along with terms and conditions of borrowing.