Christmas is just a few weeks away. You’ll be making your list and checking it twice. But it’s not just presents you’ve got to think of. Food, parties, driving to relatives and decorations are just the tip of the iceberg when it comes to spending money at Christmas.
All this extra spending puts pressure on your bank balance. Add this onto your rent, bills and usual expenses such as your weekly shop and it’s obvious you need to keep a careful watch on your money.
It’s been predicted that 1.4 million people in Britain will take out a payday loan to fund their Christmas this year. A typical adult spends £530 on Christmas and the nation pays out £26 billion during the season.
If you’re struggling to make payments over the festive period, you may be tempted to take out a ‘payday loan’ to help cover the costs. Adverts might make it seem that it’s quick and easy to take out a small loan, but the hidden dangers are what can catch you out in the long run.
The high interest rates can put your finances in a spin well after Christmas and into the New Year. Pay day loans can have interest rates at over 1,000 per cent!
Even if you take out a loan and pay it back on time, the loan companies will target you to offer more. You might be tempted to take out another one but would you be able to pay it back this time? Loan companies can also take a payment out of your bank account without you knowing if you sign up to a ‘continuous payment authority.’
It can harm your credit rating which will make it harder for you to get finance in the future: to take out a mortgage for example.
We appreciate times can be tough but be wary of taking out a payday loan. There are more hidden and long term dangers than meets the eye.
There are different ways you can avoid taking out a payday loan this Christmas and we have a range of tips and information to show you how. From money saving tips, getting on top of your debts and budgeting your finances to help you save. Find out more about getting the most out of your money by clicking here.
To find out more about the dangers of payday loans and how to avoid them, click here.