Managing Spending on the Unsecured Personal Loans’ Budget

Managing Spending on the Unsecured Personal Loans’ Budget

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Christmas is here and it can be costly

Many buyers are looking for unsecured personal loans to get them through the holiday season. Despite discounts and specials, consumers are going to have shortfalls in budgeting. The easiest way to manage the holidays is to understand the tactics retailers use to draw you in. Here are some tools they use and how to avoid them.

Debit-card fees

Debit cards are convenient. They act just like credit cards, but they withdraw directly from your savings account. Normally any store that takes credit cards will take your debit card. With debit cards there are no high-interest rates to deal with so many people believe that they are safe buying options. Though it may sound like the easy thing to do, but be sure to check with your bank’s policies regarding transactions.

One thing to check for is your bank’s over-limit purchases procedures. In the past, a debit card would automatically be declined for purchases over the available balance. Banks are changing that policy. Now you can still make an over-limit purchase, but the bank charges you the overage amount and an additional fee that can range anywhere from $25 to $40. If you go to various stores and make numerous over-limit purchases, you can be charged the fee for each one.

If you are making a big purchase, it’s best to pay with credit and then pay the full balance off at the end of the month. Credit cards offer a lot of added protection in terms of identity safety and disputing retailers over charges. If you have to make small purchases and know that you have enough to cover the purchases, then a debit card will work just fine.

Watch out for sales

Everyone knows how sales can attract customers. Black Friday and Cyber Monday are both huge sales days for retailers. Although their specials may sound nice, the reality is that a lot of them are nothing more than ways to get you into the store. Many retailers feature a limited-quantity product and once it is gone, they have a backup product ready. That equitable backup is notably higher in price. If you come to the store with a limited budget from savings or from an unsecured personal loan, you may be disappointed. The best way to protect yourself is to first do some research. Find the item you are looking for online and compare prices at various retail and online outlets. If the item is notably lower at one retailer, it most likely is not worth your time.

The extended warranty

Almost every retailer will try to up-sell you with the extended warranty. Appliances, electronics and machinery are all high-ticket price items. You may be spending thousands on them and retail outlets will try to get a couple extra hundred dollars in special extended warranties. They will tell you how any repairs for a year, for example, will be free of charge. Though extended warranties seem like good ideas, large items normally come with manufacturer warranties already. The best thing to do is do research and find out how long the manufacturer warranty is. Most likely it is at least for one year and it’s free with purchase.

Don’t be fooled by gift cards

Gift cards are convenient. You walk into a store and pay for the card. Then the user can use the card like a limited debit card. Unfortunately more and more companies are attaching fees to gift cards. Some cards come with processing fees, activation fees, expiration dates, transaction fees and inactivity fees. Another concern with gift cards is that according to a recent study, 25% of people who received gift cards, still hadn’t used them a year later.

The easiest way to avoid all the fees is to pay cash. Almost everyone remembers receiving cash in a check from relatives when they were a child and it makes sense to go back to that method of gift-giving. If you need a gift card though, there is a way to avoid fees if you do some research. For example, American Express announced recently that it would no longer impose fees on any gift cards, but it would still charge $3 to $7 to buy one.

Managing during the holidays

Managing sales during the holiday is important. The bottom line is that retailers want to get you into their stores by any means necessary. Competition pushes them to create discount advertisements that work on customers. If you have a limited budget from savings, credit limits or unsecured personal loans, you have to be smart about your spending.

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