Whether you are dealing with an emergency, a big purchase, or just need some extra cash, you may be wondering what your options are. Luckily, there are many ways you can borrow money to meet a financial need. Let’s dive deeper into how you can decide whether you should borrow money, and some popular options to explore.
How to decide whether you should borrow money
To figure out whether borrowing money is a good idea, you should assess your current financial situation. Going this route may make sense if you need some extra funds to cover essential expenses like rent, groceries, or gas. You may also want to consider borrowing money if you’re in a financial bind and have to pay an unexpected cost, like a car repair or medical bill. But before getting a loan or credit card, make sure you have a good repayment plan in place. This way, you can pay back the loan on time and avoid paying more in interest and fees.
Ways to borrow money
If you’ve decided borrowing money is the right choice for your situation, here are some ways to do so:
Get a personal loan
A personal loan like a cash advance or installment loan can be a great way to get the funds you need quickly. With cash advances, borrowers can typically receive a few hundred dollars to cover expenses before their next payday. You may repay this loan in two to four weeks, depending on when you receive your paycheck. And with installment loans, you can receive a larger sum of money all at once that you’ll repay in fixed monthly payments over time.
Whichever personal loan option you choose, you may be able to apply online or in store in just a few minutes. Many lenders offer quick or instant approval decisions, so you may find out whether you’re approved right after you apply. Better yet, you may not need good credit to get a personal loan.
Apply for a credit card
A credit card can provide you with access to funds you can then use to meet expenses, up to your credit limit. While credit cards may take some time to obtain, they can give you added financial flexibility, along with several cashback or spending benefits. But be careful about using credit cards for bigger purchases. Make sure you don’t max out your credit card and can pay back what you owe on time so that you don’t have to pay more in interest.
Borrow from friends and family
If you have friends or family willing to lend you money, this can be a good way to get the funds you need fast. Getting a loan from a loved one can often be helpful for emergencies where you don’t have time to obtain a loan or credit card, and they can also come in handy for larger purchases. But before borrowing money from a family member or friend, make sure to put the loan agreement in writing. This can help you understand any expectations they may have around being repaid.
The bottom line
You may need to borrow money at some point, whether you have to pay essential or emergency expenses. That’s where personal loans, credit cards, or borrowing money from a loved one comes in. Compare these methods and assess your financial situation to figure out which option works for you. If you choose wisely and have a good repayment plan in place, this is a great way to give yourself more breathing room and help you get out of a financial pinch.
Notice: Information provided in this article is for information purposes only. Consult your financial advisor about your financial circumstances.