Good money management is about more than building up savings to meet your goals; it’s also about being able to use credit responsibly to help you achieve your goals.
Emma Mer, CEO of FNB Personal Loans says the average South African adult often turns to taking out a personal when they need extra cash due to structured repayment terms and ease of accessibility. Mer warns, “Every consumer has a duty to manage their personal loan responsibly in order to keep their finances and credit worthiness intact.” Borrowing for every day expenses or for unnecessary luxury items is ill advised; rather save up for these and manage your daily expenses carefully within a budget.
Useful tips to help you become credit smart:
- Borrow from a trusted provider
Be very selective about where you borrow money. It’s safer to borrow from a bank, as they are governed by strict industry rules.
- Don’t over extend yourself
Financial discipline is important. Avoid the temptation to borrow more than you require, as this could have a negative impact on your disposable income and your credit record if you become unable to repay.
- Make sure your installment is manageable
The term you choose to repay directly impacts your monthly installment. Make sure you can afford your repayments and if possible, try to pay off your loan early.
- Pay on time and by debit order
Paying your loan installment on time is important in order to keep a good credit record, which determines your ability to get credit in future. Paying via a debit order is one of the easiest, most reliable and cost effective ways to meet your repayment obligations, and helps with your budgeting.
Visit your bank to find out more about their personal loan terms.
Source: FNB. Image: Pixabay