Whether you have borrowed money from your close friend or from an instant cash loan lender, debt is always a cause of great stress. You know you have to pay it back in a timely manner to avoid any future inconveniences. The dilemma with a payday loan, personal loan or cash loan is that the payback period is usually very short and if you fail to clear your outstanding dues within the agreed time frame, you can end up paying huge penalties. This will not only hurt your credit ratings, it will put you in a vicious cycle of borrowing money to clear your outstanding dues. Once you are trapped in this cycle, it becomes very difficult to get out of it. The only way you can ensure to stay out of this vicious borrowing cycle is to make sure you always spend your instant cash loan wisely.
Let us have a look at some of the ways to ensure the best utilization of your loaned money:
Use the Money For Emergency Situations Only
Especially when it has become easier to obtain an instant loan approval from money lenders in Singapore, you might be tempted to spend it all. However, you must keep in mind that with every loan comes and interest incurred. The ease of instant loans is here to provide you with a solution in times of a financial emergency. Unless you are faced with a real emergency, you are better off staying free of any debt. Do not use the quick cash loan money to pay for unnecessary wants like your favourite car, TV, mobile phone or any other luxury items when you know you are facing a budget strain. If you start spending the loaned money on non-emergency situations, you will soon find yourself buried deeper in debt. It is therefore suggested that you should reserve this option for one-off emergency situations like paying hospital bills.
Avoid Overspending
Once you have secured a payday loan or an instant cash loan and used it to deal with the financial emergency situation, you may be tempted to use any leftover amount to buy other unnecessary items. This is the worst utilization of your loaned money. Instead of spending it lavishly, you should return or save the leftover amount to use it when your next payment is due. If you borrow more than you actually need, you will have to repay the loaned amount with extra interest that you could have saved at the end of the month. Therefore, keep the loaned amount low, this way you will be able to pay it back quickly without incurring any additional late charges or higher markups.
Avoid Default
Like any other type of loan instrument, make sure to make your monthly payments of instant cash loan on or before the agreed time every time. Always try to avoid any default situations as it will not only hurt your credit history, it will also deter your chances of getting any future loan approved. If you smell any default situation approaching, get in touch with your money lender right away to re-structure the plan.