A big loan can be disheartening, especially if you have to adjust your finances on a large scale. Many borrowers have even escaped from their loan responsibilities, thus leading to bigger penalties and harder financial situations.
If you have a large outstanding loan, you must bear in mind that paying it off is always possible.
Here are some pro tips that will help you finish your
Save Like an Entrepreneur
An entrepreneur’s life is full of challenges, hurdles, and loan payments. If you can save like an entrepreneur, then you will have a fair chance of paying your loan as early as possible.
To start saving in an entrepreneurial way, you must have a journal (physical or digital) of your saving milestones. Tracking these milestones will help you know and understand your current standing with the loan. Plus, you can adjust your financial priorities efficiently.
Launch Multiple Side Hustles
In an age where consumption is a major leading force, anyone will have a hard time balancing finances – unless you are born with a silver spoon in mouth. A big loan can make it hard for anyone to save money or even make extra profits. The loan must be prioritized first, and your job will barely cover it. But there’s always a solution! You can launch multiple side hustles as long as your schedule fits nicely.
Before you launch any side hustle, you must do your homework first. Research about the hottest niches in your location and determine the best platform that can support your project.
Once you already have two or more side hustles, you’ll find out that repaying your current loan will be easy indeed.
Sooner or later, you might even need the help of a credit entity to expand your side hustles.
Create Different Reminders
Reminders are everywhere. You can see it on a college student’s handbook or a professor’s lesson plan. Offices are also full of post-it notes and corkboards with reminders pegged day by day. If you are not the type of person who takes reminders, then you must learn how to use these little tools to pay off your loan.
Reminders will set you on a straight path towards fulfilling your loan. You don’t have to buy as many notebooks as you want – a simple digital app will get you started.
The reminder points that you have to set are payment deadlines, the ‘week before the deadline,’ amount that needs to be settled, and other terms set by the lender. Reminder-setting is a simple method that can change your personal finance journey remarkably.
Renegotiate with the Lender
Lenders are not strict task masters who will demand payment in a harsh method. Realistically, most lenders will collect payment in a humane and fair way.
Pawnshops, for example, will offer some viable options to help you settle the loan. This paves the way to renegotiation and a better consensus to both parties.
While renegotiation is possible, this is not always the case. Some lenders are strict with their policies, while others will take your credit score against you. If the lender doesn’t want you to renegotiate, take it as a lesson.
You should always look for a lender that’s willing to
help you throughout the repayment process.
Cut Corners if Possible
Are you craving for that Caramel Macchiato even if you’ve had a cup of coffee? In that case, then maybe you are spending too much money! It’s not bad to satisfy your cravings every now and then. But if you have to do it every single day and you have a loan to worry about, then you’re facing a big problem.
One of the main reasons why borrowers can’t pay for their loans is over-consumption. To get rid of your current loan, you may need to cut corners. However, this method is easier said than done.
Cutting corners doesn’t mean that you have to forego the best things that life has to offer. Your goal is to limit your consumption and remove the stuff that you don’t need as of the moment.
Some of the things that you can cut from your monthly budget are magazine subscriptions, cable, subscription boxes, over-fancy meals, and luxury items. There is no hard and fast rule in cutting money-draining things – you need to make the assessment on your own.
Paying off a big loan successfully takes more than a dash of discipline. You need to follow your financial game plan and stick to it.
If the process is difficult, don’t lose hope! Sooner or later, you will be able to finish your big loan and apply for another. Just remember to pick loans that you can settle within a short time frame.
Fervil Von is a Filipino marketer and the online business consultant for Cash Mart Singapore Lending – a private lending firm dedicated to bridging financial gap in South East Asia. He’s highly passionate in sharing his knowledge and experience in business, marketing and finance. Connect with him on LinkedIn.