Originally posted on May 8, 2019 @ 6:34 pm
A tight financial situation is nerve racking and stressful. You’re up to your neck paying utility bills, your mortgage, or some unexpected medical bills. You may be wondering what is the easiest way of borrowing money.
Here are several ideas to get extra money fast and easy, to remedy short term cash setbacks. That said, the best solution is to earn extra money rather than borrow it.
Borrow from friends
Friends will stick with you through thick or thin, when money is tight or flush. Just be honest if you ask for money and don’t use a silly hard luck story.
Make sure to pay the loan back promptly and in full. Otherwise, you’ll end up asking your self, “Where have all my friends gone?”
Borrow from parents
When in a tight financial bind, parents can be another possible resource; parents have soft spots for children in need, especially in emergencies, and would most likely disregard loan interest.
Some indulgent parents don’t even expect to get their money back. Make sure, though, that you pay them back to make it easier for you to approach them the next time you need financial help.
Ask your life partner for a little help
Depending on how comfortable you are with borrowing from your partner, it is a relatively easy source of instant loan.
To avoid getting into a sticky situation, make sure you draw a line between a loan that must be paid at pre-agreed terms and a dole out.
Financial matters might cause a hitch in the relationship if not handled sensitively, so proceed with extra caution.
Borrow from your 401k
Your 401 (k) Plan is your fund stashed for the rainy days when you would not be as healthy and as strong in providing for your needs.
It is not wise to make an advance from your retirement savings plan; hence, it should not be resorted to if you still had other means or fund source.
If and when you do decide to access funds this way, study the disadvantages and be prepared to pay for penalties and taxes. If untouched prior to retirement, your 401 (k) enjoys tax-deferred status and compounded interest.
Loans from Credit Unions
If you are a member of a credit union operating in your area, you are considered as part-owner and, hence, have privileges which include eligibility to borrow loans from the cooperative institution.
Rates are usually lower than those offered by banks and requirements might not be as stringent.
Borrow from work
No worries here, large companies extend salary loans to workers. So, if you’re employed in one of those big firms with such policies, you might as well grab the opportunity, but be sure to leave some for your take home pay. Or suffer the wrath of your hubby.
If all else fails …
The above ideas may cost you a small amount of cash in interest; however, the next ideas will cost you a lot of money in interest. Use extreme caution.
This is where your high credit rating and adequate financial resources come into play to get extra money fast.
Interest rates are high and expensive, but if you choose to play the 0% interest game, you could pay no interest at all. It is termed as stoozing or moving your balance frequently so you don’t pay interest.
Bank Loans or Overdraft
You may also ask your bank to extend or authorize an overdraft from your current account if your bank allows it. The disadvantage is that this type of loaning method may be quite expensive. Be sure you know the terms and have a plan to pay this off in the shortest period possible.
Quite a number of business establishments extend equity release policies. But this can only be an applicable method if you own a house; where the difference between the value of the property and the mortgage is called equity.
Using equity can be a good idea for establishing a business deal because mortgage rates are among the lowest cost loans extended nowadays.
Always proceed on the side of prudence; ask for some good advice from your own mortgage broker before you plan to take money out of your prized house. Likewise, consider this method as one among the last resort options.
Cash Advances or short-term loans
These are small, short-term cash advances to momentarily cover the borrower until the next payday.
Payday loans have extremely high interest rates, way higher than what most banks offer; they could be really dangerous to your financial capacity; there’s a high risk of your falling prey to loan sharks. These must be wisely considered as a last resort.
These places should be viewed as a last option as they usually charge high interest rates.
The idea here is to trade any of your valuable possessions or personal effects as insurance against the loan – without need of presenting proof of income or a high credit rating.
This is easy, quick, and not a lot of questions asked. After repayment of the loan and interest, you get your valued articles back.
Always remember: Borrowing money should be a last option during emergencies and definitely not a regular source of funds for satisfying your indulgences and luxuries.
We all can live happy lives economically by subsisting within our means and be debt-free without sacrificing much – like finding time preparing your own food instead of taking home pre-cooked dishes full of additives. Forego gym memberships and unimportant subscriptions.
It takes discipline and hard work; but you will be rewarded with peace of mind, something no money can buy. I hope this provides a few ideas about what is the easiest way of borrowing money.