I’m so broke it hurts – Should I take out a loan?

Mar 07, 2016
Author: Ean Barnard

“If your bank account looks like the middle of the South African Karoo, where the tumbleweed drifts by in the wind, you may have a problem in taking out a loan.”

It’s no fun being broke. But before you throw your hands up in the air and accept it as your lot in life, consider the fact that spending your hard earned money wisely is something many struggle with. The discipline is not for the faint hearted.

“Many South Africans are one flat tyre or a sick dog away from a financial mess.”

Is applying for a loan a good idea if you’re not so high on cash? The thing is, if you’re broke, you can’t really afford another monthly loan payment, and isn’t this exactly what you will be adding to your plate? It could be time to take a hard look at the decisions that got you here. It will be wise to abandon this sinking financial ship for something better. So, let’s take some time to recognise some reasons that could make you broke.

When your cash flow is down low and you’ve been living the paycheck-to-paycheck lifestyle, feeling as soon as you get paid you go straight back to being broke, something needs to change. It’s probably time to start thinking of downsizing expenses and firing up the habit of effective budgeting. If you have habits that are keeping you from improving your financial situation, first sort them out before considering a personal loan or any other short-term/long-term loan.

So should you get a loan now? No. Debt doesn’t keep people in debt, bad habits do! Take a look at your spending habits and where you can cut back on all non-necessities, they are there! Take a closer look, in other words, be a cost-cutting machine! Next up is to increase the cash coming in. You can always find ways to earn more money, there are countless ways to bring in a little extra cash each month - it will come down to your attitude.

“But - what should I do?” you ask. We don’t know, but we know there’s more to you! Don’t lose hope.

“Always practice gratitude for what you do have, not what you don’t, and remember, you’ve probably never seen someone so poor that they didn’t have clothes on.”

In a nutshell, take a hard look at your habits, start cutting costs, and develop a budget plan that works for you. This way you can firstly improve your financial situation, and then you can come back to the Fincheck page and with confidence, apply for a loan.

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