Tips and Tricks For Managing A Loan In Your 20’s
It’s almost impossible for anybody nowadays to get through life without applying for a loan. There are so many things that require large sums of money. Unless you’re independently wealthy, come from a wealthy family, have a sugar daddy or mama, or you’re a trust fund baby, you’re going to have to get creative with the ways that you finance things in life.
This will be the case when you’re 16 and you buy your first car, this will be the case when you go off to school and financial aid doesn’t even begin to cover costs of living in addition to books and everything else, this will be the case when you buy your first home, and when you buy your second home…basically going through life without getting a loan isn’t going to happen so it’s important that you learn how to manage a loan while you’re in your 20’s. Here’s what you should be doing:
Be Patient and Look For Low Interest
Too many people are in a hurry to acquire a loan. When you’re looking to finance a large purchase, you’re going to be feeling pressure to get the money in whatever way you can so that you can make the move, but resist the urge to bond yourself to a loan on an impulse just because you’re approved.
A high interest rate will be the death of you, especially if you borrow high and you pay off in low chunks of change. Do some searching around, don’t settle, and wait for a loan to come into your corner that is offering low interest. This could mean the difference between thousands of dollars for you in the long run.
The Quicker the Payoff, the Better
When you’re in your twenties you’re still getting used to all the expenses you have to pay on in life. This means that you might have to urge to only make the minimum payment required on a loan.
This isn’t a good practice to have in life because you will be paying on a loan forever and the longer the money sits unpaid, the more interest piles on and you’ll find that you’re now paying back $17,000 dollars on a $12,000 loan just because you took your time paying the piper. Do what you need to do to pay of the loan as soon as possible and you’ll be in a better position for it.
Put Money in An Account For Automatic Payments
If you know that you’re a forgetful person or you just don’t want to have to worry about making payments on your loan, it is smart to put a chunk of change in an account that will make automatic payments on the loan. If you’re loan is through your bank or credit union, this is easy to do. It will save you from having to think about yet another thing in your 20’s.
