Spirit Loans – UK Loan News and Info

What is the Difference Between Investing and Saving Money?

There is often a lot of confusion about investing and saving money and the differences between them. A lot of people may even use the terms interchangeably and think that they are pretty much the same thing. This is not the case though and it is a good idea to make sure that you do have a good understanding of the difference because it could make a huge difference when you are deciding what to do with your money. The main differences are explained below.

Long Term vs Short Term
You will find that if you take out an investment, the value of it will fluctuate a lot in the short term. This means that the value can go up and down and lot. Therefore, if you cash in quickly, you could find that you will get back less than you paid in, especially as it is likely that there will be administration charges as well. However, with savings it is likely that you will still make a little bit of interest even if you only have the money saved for a short amount of time. If you have it in an instant access account then you will be able to draw it out as soon as you like and you will get the money back plus any interest that it has earned.
Safety of Money
With an investment you are buying an item with the money. Then when that item is sold, you will get back what it is worth. You might be buying shares, property, art or other things. If the value of the item goes down then you will get less back than you paid in for it. You may even find that the value falls so low that you get back nothing at all. With savings, as long as you put it in a place covered by the regulator, you will be guaranteed to get your money back.
Rates of Return
The big attraction of investment for many people is the promise of great returns. For a savings account, the interest rate tends to be very low. Even if you tie your money up, you cannot expect to get that high an interest rate. However, with an investment, the returns can potentially be really high. It can be possible to a growth which is get many times more what you can get on savings.

You therefore have a difficult decision to make. By taking on an investment, you will be taking on a large risk. It will be possible for you to lose money and you could even end up with getting back a lot less money than you put in. However, you could find that you will get more money back because it performs well, compared with savings. You are more likely to do well if you invest for a long time though and that means that you are likely to need to keep your money tied up for at least five years, if not a lot longer. It is always worth thinking about the money and what you are prepared to do with it. Think about whether you are happy to risk losing it, if not use savings. Also think about whether you can afford to lose it, if not save it. Then think about what you are happy about the stress of taking a risk and how you might feel if the money reduces in value significantly. This will enable you to think about whether you are prepared to invest or save the money that you have. It is not an easy decision but once you know the main differences then this will help you.

Credit Scoring

How Can I Improve my Credit Score?

These days, we will often hear a lot of talk about credit scores and the need to have a good one. It can be a bit worrying as well as confusing and we may think that we should be concentrating on improving our score. This can be worthwhile but it is not always easy to know what to do or where to start.

Check Credit Record is Correct

The first thing to do is to have a look at your credit record and make sure that the information on it is correct. You will find that there is a lot of information on there and sometimes it can be out of date and so it is a good idea to take a look at it and see whether this is the case with this. It might be that you have ended contracts or repaid loans and this has not been reflected on the report so just make sure of this and you will be able to contact the company that has not reported it correctly to have it changed. This is an easy thing to do and could make a big difference.

Pay things on Time

It can be a good idea to also make sure that you pay for things on time. It will be noted on your credit report If you are late paying for something such as a loan repayment or utility bill. Prospective, landlords etc will see this and it will be a cause for concern. They will worry that it could mean that you will not repay/pay them as required and this could put them off completely. Others may charge you more so they can have more money when you do pay to cover the costs of you missing a payment. So work hard to make sure that you always pay everything on time and in full.

Pay off Loans

It can look better if you do not owe money to too many people. If you have a lot of commitments with regards to repayments to make it may make lenders feel that you cannot be trusted. This is something that you can change by paying off some of the loans. They will then feel happier in two ways. Firstly, they will not worry that you are paying out so much money for various loan repayments that you will not have enough for their payments and also it will not look like you are so desperate mor money. Looking desperate indicates that you are not managing your money very well which is not a good thing.

Do Not Apply for Lots of Loans

If you apply for lots of loans, this can look like you are desperate for money as well and could put people off. It will also look bad if you get turned down for a loan. This could put people off before they even look at your credit report in any detail. They may see a rejection and automatically follow suit without even considering why you were rejected and whether it is something which matters to them. So be extremely careful and try to check with lenders whether you will be likely to be turned down before you apply.

Have a Decent Salary

Having a permanent job and having a decent income can be something which will really go in your favour. I know that it is tricky for some people to do this, but it might be something that some people have a choice about. For example, if you are freelancer, temp worker or on a zero hours contract, this may not look good and so if you can find more permanent employment then this can help you to be able to impress better and therefore have a better credit report.

Budgeting

How to Stay Motivated to Stick to a Budget?

If you have decided on a budget and you want to make sure that you stick to it, then you might wonder how you will be able to stay motivated. There are a few tricks that you can try though which should help you to stick to it.

Think About Why you are Budgeting

It is a good idea to have a good think about the reasons why you want to budget. It is likely that you have a specific goal in mind and that you need to keep focusing on it to make sure that you remember why you are putting in all of this effort. It is a good idea to try to think about this a lot as it will really help you. There are some tricks to help with this as well.

Write it Down

It can really help if you write down your goal. Research has shown that if you write down a goal, you are more likely to achieve it and so this could be helpful for you. It could also help for you to go a bit further and think about why you want to achieve this goal and how it will improve things for you. If you write down these details too, then this could all help you.

Stick it Somewhere Prominent

As well as writing it down, it can be worth making sure that you stick it up somewhere prominent. This means that you will have the opportunity to read it frequently and that will help you to keep remembering why you need to stick to the budget. It will give you the opportunity to be able to read it.

Read it Twice Daily

It is important to make sure that you actually read it through as well. You may do to start with and then you might then find that you do not continue with that after a while. Therefore, try to read it through at least twice a day. This will help you when you feel like you want to spend some money when you have not budgeted for that item and it should help you to be able to resist the temptation.

Have Some Treats

It can also be good to treat yourself. Think about what your budget is and perhaps break it into stages and then treat yourself at each stage. So, for example, if you have a loan for £1,000 to repay then break it down into £100 portions and every time you pay off £100 then give yourself a small treat. Work out what they are going to be beforehand and this will enable you to be able to have something to look forward to and aim for. It should not be anything too expensive, but still something significant that will make you really want to be able to push on with your goal. You could make it every £200 or even £500, think about what will work for you.

This will take a little effort but it can really pay off. It will enable you to be able to focus more easily on your goal and make sure that you will be able to maintain that focus as much as possible. It is worth just having a quick read, possibly morning and night and then this should help you to keep going through the day and thinking about what you need to be able to achieve that each day. Hopefully, as you reach each target and get your reward, it will push you on towards the next one and help you to be able to achieve that too.

Loans

How to Budget to Repay a Loan

There are lots of people that have loans that they would like to repay, but just cannot see a way. With some types of borrowing, such as credit cards. There is no need to repay it quickly and so it can just build up or hand around for a long time and this can make it hard to repay. Also, some people might want to repay a loan more quickly than they have to. This can be great, but they will have to find the money and a good way is to use a budget. However, how can this be done?

Check Status

The first thing that you will need to do is to find out what your current financial status is. You will need to think about what money you have coming in each month and what you have to pay for. This any commitments or bills, loan repayments, rent, tax , insurance and anything else that you have to pay. Also include food, travel, toiletries etc. Once you have added all of this up you will be able to work out how much money you have left. This is the money that you would normally spend on non-essentials and this is the money that you will be able to target to use to repay the debt. You will not always have to use it though. You could find that you will be able to free up money else where and that you could also set a budget so that you have some money available for buying fun things too. You also need to think about how much you think you will be happy paying off the loan each month as it may be a huge priority for you or you might rather have money for other things as well.

Allocate Money

You now need to allocate money to different areas for spending. You will need to pay for all of your essentials, but you may still be able to reduce what you spend on them. For example, you might be able to go to a cheaper insurer or you could buy your groceries in a cheaper supermarket or things like this. It is worth researching the areas that you are spending money in order to see whether you will be able to cut down. Sometimes, you might be able to cut down without even seeing a significant change, for example, if you change your utility supplier to a cheaper one you will still get energy in the same way but you will be able to pay less. If you can therefore cut down how much you are paying for this, you can easily have more money available to repay the loan. So, it could take a while to get everything organized but eventually you will be able to set a budget and this will enable you to be able to work out how much money you will have to spend each month on each item so that you know that you have enough to pay back the amount of your loan that you want to pay each month. It will be up to you to decide on how much of the money left, after you have paid for your essentials that you want to use towards the loan. You could vary this from time to time, by reallocating budget, but you will need to think about making sure that you do not spend too little on the loan repayments as you could end up not reaching your target and repaying it as soon as you wanted to originally.

Payday Loans

Can I Use a Payday Loan to Buy a Car?

There are lots of people that have not used payday loans before and therefore will have a lot of questions about them. Many people might wonder whether they can be used for specific purchases, such as to buy a car. It is worth knowing that there are no restrictions with regards to what you are allowed to buy with the money, but there could be restrictions due to the nature of the loan. So, although, you could buy a car with the money in theory, in practice it might not be the best idea or it may just not be possible. There are few reasons for this which are worth thinking about.

Amount of Money you Need

It is worth being aware that payday lenders tend to only lend between £100 and £1,000 at a time. This might be enough money for some people, but it will all depend on how much the car costs that you are thinking of buying. There are also possible restrictions made by certain lenders. There will be some lenders that will only lend a few hundred pounds to first time borrowers. This is because they lend to people regardless of their credit score and want to build up trust with them. They will therefore only lend a small amount of money to start with and if that is repaid on time, then they will lend more. So, if you need more than a few hundred pounds, then you may not be able to borrow enough. However, it can be worth approaching different lenders to find out what they are prepared to lend you and you may find one that will be able to help you out.

Repayment

It is worth being aware that the repayments on emergency loans are made in one lump sum on the next day that you are paid. This means that you only borrow the money for a small amount of time. This could be great for those people that do not like being in debt for very long, but it does mean that a large sum of money will need to found quickly. This can be okay as you will pay it on the day that you are next paid and so there will be money available but you will need to check to make sure that it will be enough. Bear in mind the fact that you will need to pay for other things as well and you will probably have other payments also going out of the account and so you will need to take a look first, note down the figures and calculate whether you will be able to afford the repayment. It is likely to be within a few weeks of when you take out the loan so you will not have long to find the money to pay for it.

Cost

All loans have a cost and it is a good idea to make sure that you find out how much this will be. Remember that this cost will add to the cost of the item that you are buying with the loan and it is a good idea to find out how much it is. Consider whether you still think that the item is worth buying if you also add in the cost of the loan that you are using to buy it. The lender should be able to tell you what the cost will be, so ask them and then you can consider whether you think that it will be worth it. It is a personal thing as to whether you feel it gives value for money and therefore up to you to decide.