Debt Freedom: How to Cover Holiday Financial Shortfalls

November 29, 2017 | Category: ,

The holidays are a time for celebration — time with family and friends, great food, wonderful presents… But the gifts, the grub, and the travel aren’t free and what starts out as fun can often turn scary once the harsh reality of post-holiday bills arrive.

What if you could stop that from happening? What if you could afford the gifts you want and achieve debt freedom at the same time?

Multiple choice question — if you need money for holiday shopping, what is your best option to achieve debt freedom quickly? Is it:

  1. Credit Cards
  2. Payday Loan
  3. Personal Loan

If you said a. Credit Cards — you are wrong!

Credit cards are revolving credit and can start a cycle of minimum payments and maxed-out balances. By only paying the minimum, you will never pay down a credit card as they are set to a small percentage of the balance. That means you could still be paying off the 2017 holiday debt by the time the 2020 holidays roll around.

If you said b. Payday Loan — you are also wrong!

Payday loans can actually be the worst choice a person can make, even though it seems like the easiest. Payday loans can sound too good to be true — and that’s because they often are. It all comes down to interest and fees. In Ontario, payday loan lenders can charge up to $18 on every $100 you borrow. You also have only a short timeframe to pay it off, usually between 14 to 28 days, but legally no more than 62 days. The most money you can borrow is $1,500. So, if you borrow $1,500 at the beginning of December for your holiday shopping, that’s potentially $1,770 you’d have to pay back before the end of January — on top of all your other bills and monthly expenses. If you can’t afford it now, will you be able to afford it then?

If you said c. Personal Loan — ding ding ding! Congratulations, you are the winner of total debt freedom!

A personal loan can be put on a fixed repayment schedule — a.k.a. you’ll know when it will be paid off and exactly how much interest you’ll have to pay back. You can determine your repayment schedule — there is no legal time limit. In addition, personal loans report to your credit report, so you’ll get a better credit score by paying it back on time, and often have an equal monthly payment. You’ll know exactly how much you need to set aside every month and can plan out your budget accordingly. Personal loans are also unsecured, so you won’t have to put up any of your assets as collateral. You’ll be able to get your money in time for your holiday shopping, and relax all holiday long knowing your debt is managed.

Prudent Financial Services can help you find the personal loan you need to celebrate the holidays without regret.

Visit us today at or call 416-223-9300.

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