Ways to build your emergency fund

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Almost every financial advisor will advise you to have an emergency fund in case of a financial emergency. You never know when you are going to lose your job, or face an unforeseen financial calamity. It is always good to start early. Moreover, building an emergency fund is not as difficult as it sounds.

You need not drastically sacrifice your lifestyle or haggle with service providers for reducing rates. Do not disturb the fund and use small loans from your moneylender for out-of-pocket expenses. Read some ways to build your emergency fund.

You need not drastically sacrifice your lifestyle or haggle with service providers for reducing rates. Do not disturb the fund and use small loans from your moneylender for out-of-pocket expenses. Here are some ways to build your emergency fund.

Keep your fund smartly

Emergency funds should be kept accessible, but not enough to tempt you to use them for daily expenses. Some people have a different bank account for emergency savings. This helps to create a psychological barrier between the two requirements. You can also go for credit unions.

Automate your savings process

You can use the GIRO system to divert a portion of your monthly earnings towards your emergency fund through automation. Ideally, 20 percent of your total income should be kept aside for an emergency. Do not rely only on your willpower. Automation also helps to keep the money out of sight.

Go for income expansion

This is especially for those earning under $2,000 in Singapore. For these individuals, dedicating 20% of the earning, post CPF, is not an option. Get an additional job or one-time freelance gigs. You can even start a small business before you start building your emergency fund. The business can be funded using a small business loan from a licensed moneylender.

Save from every purchase

As mentioned earlier, making small changes to your lifestyle would be helpful. Get your own equipment and drop that expensive gym membership. You can save from phone bills and daily utilities as well. Use public transport instead of taking cabs or driving your own vehicles. Make choices like generic drugs over prescription drugs and homemade food over eating out.

Save huge in a short period

If you are single and do not have to support a family, cut down on your lifestyle and purchases for a couple of years. This can be done by surviving on half of your paycheck. This will help you to amass a large amount in your emergency fund in a short period of time.

Get payday loans for small emergencies

You do not need to break open your emergency fund if your car breaks down. For all such unforeseen instances where you need small amounts of money, payday loans are useful. Just contact a licensed and reliable moneylender. The best thing is that moneylenders aren’t that concerned with credit ratings of applicants, hence the approval is quick.

from Financial Directory Singapore https://www.financialdirectorysg.com/2016/11/18/ways-to-build-your-emergency-fund/

via Financial Directory Singapore

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Top 5 reasons to take a payday loan

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In a payday loan, your moneylender will use your paycheck as collateral to lend you small amounts of money. Unlike personal loans or home loans, you do not need to borrow more money than you need. Moreover, they can be paid off in a short period. There are other advantages that payday loans have over other loans. Here are the top 5 reasons to take a payday loan.

You don’t necessarily need a good credit score

If you need to buy something that has been long due, a payday loan is ideal. If you apply for a loan without a robust credit score, the application will most likely be rejected. The reason is that banks conduct thorough background checks before granting a loan. If you haven’t been able to build a good credit score so far, you may still get a payday loan. Licensed moneylenders less concerned about credit score and more about your current income status. However, be sure to make timely payments to your moneylender.

It is legal and safe

Payday loans are meant for small expenses that cannot wait until your next payday. Therefore, do not expect to get a loan amount more than what you earn. Licensed moneylenders never offer more money than what you can afford to repay from your salary. That means, the loan about would be well within your financial ability and thus there is no chance of loan sharks harassing you for non-payment or delay in repayment. Moreover, borrowing from licensed moneylenders keeps you on the right side of the law.

Payday loans are extremely affordable

Payday loans are affordable because the loan amount is not very big. Despite a relatively high-interest rate, the total repayment amount remains well within your budget. Moreover, borrowing them from a licensed moneylender means that there are no hidden costs. You usually would not miss the repayment and thus avoid paying extra amounts in the long run.

Payday loans get approval faster

If someone in your family faces a financial emergency like medical, you cannot afford to waste any time. The same goes if someone requires travelling on an urgent basis. A payday loan application takes a few minutes to complete. The approval is fast and the amount is disbursed within minutes upon approval and completion of a loan contract. Payday loans are ideal for emergencies. You can apply any day of the week, 24 hours a day with your online application. Moneylenders ask for fewer documents and hence the approval process is quick.

You can use the loan amount for any purpose

Unlike many other loans, payday loans can be used for any purpose. Your moneylender will not be concerned about how you spending the loan amount. For instance, you can use the amount to deal with a medical emergency. If your car breaks down one fine day, you can pay the repair bill using a payday loan. Some people pay credit card bills using payday loans as well.

Payday loans are extremely safe and convenient when taken from a licensed moneylender. You just need to have the legal age, a bank account, and a steady source of income.

from Financial Directory Singapore https://www.financialdirectorysg.com/2016/11/10/top-5-reasons-to-take-a-payday-loan/

via Financial Directory Singapore

4 tips on how to use a personal loan

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Personal loans provide an effective way of debt consolidation. While banks offer personal loans at slightly lower rates of interest, a moneylender can provide you the loan more quickly. Even if you have a bad credit score, you may still get a quick approval from licensed moneylenders. However, you should always get a personal loan for your needs rather than wants. For instance, you can use the loan amount for a financial emergency, setting up a new business or for your education. Here are some tips on how to wisely use a personal loan.

Building better credit

A personal loan can also be used to improve your credit score. However, it is necessary to make timely payments. This also helps lower the debt usage ratio, a crucial factor that credit rating agencies use. This works by getting a personal loan instead of making multiple purchases on credit cards. However, you should check the credit report at least once a year to make sure that the information is correct. Higher credit scores invariably mean lower interest rates. Moreover, personal loans being more difficult to get than credit cards, are favourable for credit reports.

Getting out of debt

It often happens that payments of purchases get delayed for long periods of time. Individuals with credit cards often fall into the trap of minimum payment. One way to deal with this problem is by taking a personal loan. You can use the loan amount to pay off your outstanding debts. Before taking a personal loan, however, you should compare interest rates of multiple moneylenders. Lower interest rates mean that you have to pay less on repayment. Personal loans for debt consolidation allow you to make one payment instead of multiple payments. Typically, this helps save 5-7% in interest charges.

Paying off credit card debts

One can even save money by the combined use of credit cards and personal loans. This is for individuals who qualify for a personal loan at a lower interest rate than they are currently paying for credit cards. Let’s say, you have a credit card balance of $5,000 at an interest rate of 21.99%. If you can refinance using a personal loan at a rate of interest of 12%, you can save $500 within a year. In the 3 years of repaying this debt, you can save $1,500.

Making home improvements without equity

People usually pay for renovation using construction or home equity loans. However, if you cannot avail these options, a personal loan from a moneylender is a good idea. For people who are planning on moving out soon, certain renovation styles can help raise the value of their home. Whether you are considering remodels for the kitchen or the outdoors, pay using a personal loan. However, it is a good idea to assess your house’s value and consult an expert.

You can use personal loan for a number of other expenses. However, you need to make sure that you are borrowing money from a licensed moneylender and are making timely repayments. You can consider getting a personal loan for buying a car or for your next vacation.

from Financial Directory Singapore https://www.financialdirectorysg.com/2016/11/08/4-tips-on-how-to-use-a-personal-loan/

via Financial Directory Singapore

4 steps to improve your financial situation

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You don’t have to be a finance expert to be able to improve your financial situation. Regardless of whether you are deep in debt or are doing well financially, gaining control over your money is important. You can start with uncovering and change factually incorrect money scripts. For instance, it is often wrongly believed that loans from a money lender in Singapore have high-interest rates. Read the 5 steps that can help improve your financial situation.

Calculate your net worth and develop a personal budget

Net worth is the difference between things you own and things you owe. Calculate this by making a list of your assets and liabilities. Subtract liabilities from assets and you will arrive at your net worth. This figure keeps fluctuating, so it is important to make this calculation regularly.

Develop a personal spending plan. Prioritising expenses based on sources of your income is useful. Common sources include rents and royalties, retirement benefits, social security and so on. Find avenues to invest in case you have a surplus. Having surplus is also essential in times of financial emergency.

Accommodate potential lifestyle inflation

Lifestyle inflation is a common phenomenon. This refers to the increase in the amount of money spent with higher incomes. However, lifestyle inflation can damage your chances of building wealth in the long term. Peer pressure can make you spend all the money that you earn.

You should instead save for retirement. However, you will progress at the workplace and take on added responsibilities. Therefore, some changes in your lifestyle and a corresponding increase in your spending habits are natural.

Differentiate between needs and wants

Needs are important for survival. These include food, housing, healthcare, conveyance and clothing. Savings are also classified as a need in some cases. Even if you have money left after addressing your needs, you need not spend it all.

However, there are times when it gets difficult to differentiate between needs and wants. This can be done by considering cost-effective options. For instance, if you need a car, it is better to buy an economical one and not a luxury edition vehicle.

Save while there is time

Saving early leverages, the power of compounding. Compounding helps reinvest your earnings and thus magnify the value of your investment. Have a definite figure in mind and start early. This way, you will need to save less on a monthly basis.

Settle any unforeseen expenses by taking a small loan from a moneylender. However, do take note of the things to know before borrowing from moneylenders. Debt consolidation, too, can be done by taking a personal loan from a licensed moneylender. These lenders are not concerned with credit score and offer quick loans.

from Financial Directory Singapore https://www.financialdirectorysg.com/2016/11/02/4-steps-to-improve-your-financial-situation/

via Financial Directory Singapore