Why ask for a personal loan if you already have your credit card? You have it at hand, just within reach of your wallet, you don’t need to think about it much, and you are simply used to taking it out for simple things like going to the supermarket. Well now, to pay for your education, home improvement or even if you are an entrepreneur, you surely want to entrust that part to your great friend of life; The credit card.
Except you know it isn’t; It is a credit by the bank and not a friend at your fingertips. If you have been spending a lot with your card, you should know that it implies more than removing it as if nothing from your wallet, because order, budget and strategy are the tools that will save you from sinking into debt with something that looks like a simple plastic .
We do not tell you that the card is good or bad, it all depends on how it is used. Remember that your card is a pre-approved credit that sometimes suits you and sometimes it is better not. How to distinguish between my credit card and a personal loan as the best option? Take note!
Personal or productive?
The most important point is to distinguish whether your loan is personal or productive. A personal loan is when the end to which you use the money is a need that does not necessarily generate a profit. A productive loan could also be defined as an investment; When what you want is, for example, to buy equipment for your business or pay for education that will give you the tools to grow at work, it is a productive expense. The productive loan is an investment because as a result you will have profits that exceed the expense you already made.
For personal loans
Do you already have a budget? First things first, make sure you have the habit of taking note of income and expenses, only then will you know if you are ready or not to take your card out of the wallet. If you need to invest in tools for your home, such as appliances, television, computer for personal use, etc., it is advisable to pay with your card for months.
What is not advisable to pay with the card?
Goods that are not durable. For example, the super. Keep in mind that grocery shopping is something you have to do very often. If every time you go to the supermarket you take out the card, immerse yourself in the amount of debts you are going to get into. Try not to eat a lot in restaurants or buy clothes every time you receive your salary, and when you do, do not take out your credit card. The worst that can happen? That when the day comes when you already finished the things you bought in the supermarket, or the blouse that you happily paid with your card has already worn out after two washes, you will probably continue paying for the goods that you do not even have.
When to go for a loan ?
This is a bit more complex. Remember that if you are disciplined with the expenses that we discussed in the previous paragraph, when paying with your credit card you may not generate interest because you pay on time. But that is the challenge of credit cards: it is a game in which you may or may not be able to pay on time. It is important that you analyze your movements and possibilities to realize that on some occasions, you need a push.
The loans in Lifeline Finance are to help you pay on your own term. When you know that the circumstances are not optimal for you to pay on time at a bank, a loan is your option. That is why it is very important to maintain an excellent credit history, because with your credit bureau rating, you can assign the rate you deserve and it will help you to grow.
Here you have another occasion in which we recommend you 100% go for a loan. If you have a business, don’t pay the expenses with your card! A loan becomes an investment to optimize your team that can generate even more profits. And the best part of this, don’t mix your personal finances with business finances.
Examples of productive loans are also to finance your education; If you plan to enter a part-time master’s degree or a professional diploma, a loan is an excellent option since you are having income, which gives you the possibility to pay it, and also remember that you choose the term in which to do it. You dare?