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There are times when no matter how well you have budgeted in advanced, unexpected costs pops up and strain the budget that you had in place. However, there are other ways that Aussies can handle unexpected costs without attracting a high fee. Here are five ways a personal loan can help you handle unexpected costs.
Car repairs
Owning a car comes with a range of ongoing costs that need to be budgeted for. However, this can be difficult for some Australians that have many financial responsibilities that they have to handle. According to The Daily Telegraph, car repairs/replacement ranked the highest when it came to unexpected expenses with 36% of Australian households forking out this cost. It is possible to take out a personal loan to handle major car repairs which in turn can also help ease the strain on your budget.
Medical Bills
Unexpected medical bills are something that not many Australians can avoid. Even with a medical aid in place to help cover you, sometimes the cost can run high. Medical bills accounted for 25% of unexpected costs. The one mistake that Aussies do is to grab their credit card and place their medical bills on it. Credit cards tend to come with a high interest rate which can affect how you meet the monthly repayments on your card. On the other hand, a medical personal loan can come with flexible repayment plans and a competitively low interest rate with the range of lenders that are available on the market.
Vet bills
Pets are like family and when they fall ill you could soon be faced with a large vet bill that can impact your budget. The flexibility of personal loans is that there are lenders that offer loans that are specifically tailored to take care of all your vet bills so that your pet can get back to their normal self. It is vital that you compare various lenders to find one that can offer you a loan that is suitable for your situation. A vet loan can come in handy in emergency situations, but if you are able to save up for the vet bills then you could be better off opening a savings account that is automated to help you save for your scaly, furry, or feathered pet.
Travel costs
Aussies love taking holidays, but we also tend to come back with a holiday hangover that takes time to be cured. The Daily Telegraph noted that 29% of households had their budget affected because of unexpected travel costs. These unexpected costs have accumulated to large expenses that have cost the nation $52.44 billion. You can use a personal loan to consolidate your holiday debt to help you effectively stay on top of your payments.
Home repairs
Keeping your home in mint condition can be costly, but leaving minor repairs until late can be costlier. Comparing your finance options such as using your home equity or a personal loan to handle repairs is essential. Speaking to a lender or a financial advisor can also help you know what option will be best suited for your situation so you can avoid falling into a debt trap.
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This guide provides general information and does not consider your individual needs, finances or objectives. We do not make any recommendation or suggestion about which product is best for you based on your specific situation and we do not compare all companies in the market, or all products offered by all companies. It’s always important to consider whether professional financial, legal or taxation advice is appropriate for you before choosing or purchasing a financial product.
The content on our website is produced by experts in the field of finance and reviewed as part of our editorial guidelines. We endeavour to keep all information across our site updated with accurate information.
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