39.9% on loans from £3,000 to £10,000, until 31st August 2018.
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39.9% APR Representative.
Debt is something that most of us will deal with at some point.
Sometimes through our own poor decisions and sometimes through misfortune there are a number of ways we can land in financial trouble. Of course, not all debt is bad debt such as a University loan or mortgage on a property, but in this blog we take a look at 5 common reasons people get into debt.
Being made redundant/unemployed
Sadly this is something that many of us will face at some point in our lives and most often through absolutely no fault of our own. It doesn’t take a genius to know that losing your primary income is going to leave in severe hardship, unless you’re fortunate to either have savings (see below), been paid a healthy severance package or have found work in quick time.
This situation really is a double edged sword because the lack of employment and income and very quickly take a hit on your morale and confidence, leaving you panicked and in a less than firm footing to make sensible financial decisions.
Living Beyond means/keeping up with others
Often cited as a bane of modern society, trying to live above your means and ‘keep up’ (with the Joneses) is something that can not only put undue stress on you as a person, but on your finances too.
Such is the clamour to want and need what the next person has; people will lend money without considering the repayments for the sake of having that shiny new car, that designer bag or that 2 week luxury holiday. When all is said and done and the initial splurge of excitement is over, the reality sets in which is high repayments over long periods.
What’s more, the ‘Joneses’ could have possibly gained much of their possessions through lending and leasing in the first place!
Not having enough savings
If you want to avoid unwanted debt, it is crucial to prepare for unforeseen problems by putting a little money aside. Not everyone can predict when a car or oven may break down, or your washing machine goes kaput, so it comes as a nasty surprise when you’re left with a £500 hole in your finances with nothing to cover it. This is the moment when panic sets in and plays into the hands of Payday lenders by offering a very short term, but expensive fix. From there, if repayments are made, people can easily fall into the dreaded debt spiral.
Poor money management
As simple as it sounds, poor money management goes a long way to chipping away at your finances. From just shopping around for clothes can save £10-£20 a time, buying things in bulk and straying away from the throwaway culture. Consider your daily lunch at work. A study done in 2013 showed the average London worker spent approximately £7.81 per day on lunches. It doesn’t take a mathematician to work out how this can expensively stack up. We at TFS put together a blog some time back on how you can cut the cost of lunches here: Blog – Cheap and Healthy Lunches
Without a doubt the most dangerous and damaging way to put yourself into serious financial trouble. Often seen as the ‘silent addiction’, it is entirely possible to keep functioning every day with no physical and sometimes no mental signs of a problem. Given the urge for some people to ‘chase’ losses, it is not uncommon to lose thousands of pounds in a single session.
Combining online gambling with depositing with Credit Cards is the double whammy – you’re practically throwing money away as deposits for gambling sites are classed as cash advances, you will be doing so at an extremely high interest rate.
If gambling has affected you or someone close to you, then please consider visiting the following sites for information:
We offer Guarantor Loans for a range of purposes including Guarantor Loans for large purchases like cars, home improvements, weddings and other events, debt consolidation and for start-up/small businesses.
For information on finding a Guarantor, please visit our ‘Finding a Guarantor’ page, full of helpful tips and advice on finding the right person and the information they will need and how you can approach them.
If you wish to apply for a Guarantor Loan please give us a call on 0203 476 4170 orApply now
Representative APR 39.9%, subject to status.