As the holiday season approaches, many Americans start thinking about how to pay for all the expenses related to this time of year. Whether it's visiting family, traveling while everyone is off school or work, or buying presents that show your loved ones that you care, the bills can add up.
If you aren't flush with the cash to cover all your holiday needs, should you wait and hope for the best? Or should you take proactive action to secure a small holiday loan now? Here are a few reasons why you may not want to wait.
1. Reduce Stress
Unfortunately, the holiday season causes added stress for many people. While there are a lot of reasons, including family and personal relationships, money is one of the main factors that stresses people out.
By formulating and implementing your holiday financial plan in advance, you avoid this added worry. You'll know right from the start of the season how much you'll spend, where the money will come from, and when it will all be repaid. That's one important thing off your to-do list!
2. Know Your Budget
Securing a personal loan for the holidays well in advance gives you a set budget to work with. You won't have to wonder how much you can - or should - spend on gifts or decorations. Personal loans are a great way to take out a certain amount of borrowed money without being able to charge it up beyond your limit.
Credit card spending invites you to overspend well beyond what most people want to pay for their holiday fun. And if you do go over your limits, you risk higher fees and interest rates.
3. Take Advantage of Deals
Why shouldn't you wait until the holidays are closer before getting approved for some money? One reason is so that you have a better choice as to when you make purchases.
Flying to see Grandma, for example? Traveling with the entire family is expensive - and it tends to only get more expensive the longer you wait. If you find a good deal on flights, hotels, or tickets to events, you need to be able to jump on them. If you haven't secured money for it, you'll either end up missing out or adding to other, unwanted debt.
4. Get a Fixed Payment
With credit cards and other forms of revolving credit, your payment goes up as your spending goes up. If you do overindulge, you could end up with a wild payment due just as the holiday season swings into motion - and then into the new year.
While those larger payments due eventually go down again, it could be too late to save your monthly budget from the shock. A fixed payment amount and schedule makes budgeting much easier and helps you know what to expect every step of the way.
5. Negotiate a Better Rate
Credit cards are notorious for saddling many consumers with a high interest rate that only gets worse. And if you already carry some debt on them or have made errors in the past, negotiating a better rate for your holiday expenses may be impossible. You'll pay the same high rate for everything.
Why not start fresh with a personal loan that often comes with a lower fixed rate? The rate generally doesn't change as long as you stay on track with the repayment plan, and the diversification can even boost your overall credit score.
Clearly, the sooner you arrange for a loan to cover your holiday needs, the better off you'll be - emotionally and financially. Start by visiting Central Finance to learn more about how you can apply for a loan today.