The economy has caused a lot of people to make tough decisions – in this case, one woman decided to get a loan for her boat by taking out a small credit card on which she could pay off the remaining loan. Find out what might have happened if she had chosen differently in this blog!
How does the economy impact consumers?
Consumers are paying more for groceries as the price of food goes up. The rise in grocery prices is largely due to the recent economic crisis, which has led to a decrease in income and an increase in unemployment. As consumers spend less money on their food, they often turn to cheaper forms of nutrition. For example, they may buy processed foods with high sugar content. These types of foods can still provide essential nutrients that our bodies require but without the same expense and health risks of having a healthy diet.
Every month, consumers purchase everything they need to maintain life. This includes housing, transportation, and other staples of modern life. The economy has a direct influence on the way in which these goods are sold and distributed. What’s more is that the economy affects how much people are willing to spend on items that are marketed to them.
Economic downturns help business owners more than consumers
Many business owners are finding themselves with increased loan options in the current economic downturn. Businesses have had a hard time making ends meet, which is becoming more common. Many business owners are now being asked to take out loans on a boat to be able to continue their operations and stay afloat.
Online lenders are more than happy to work with business owners who may not have been able to get loans in the past. Many of these lenders offer loans for shorter amounts of time, and even if the business is struggling, there will be no problems getting a loan.
Woman decides to take out a loan for her boat
Although times are tough, the woman decided to go ahead and take out a loan for her boat. She wanted to be able to have a hobby that would help relieve stress from her day job. Not only is it fun, but she was able to get the loan for just 10% of the monthly costs.
Once she decided to buy a boat, the woman could not find any loans for boats. She did not want to take out a mortgage so she went on the internet and found a loan company that was willing to give 10% of the monthly cost as collateral for an interest free loan.
Woman goes with a standard credit card versus a personal loan
Credit cards have become very dangerous because of the high interest rates. Personal loans allow you to make only 10% of the monthly costs and they are usually not as hard to get as a standard credit card.
The woman received a personal loan from the bank and was able to pay off the boat in a year. The woman paid less than half of what she would have paid by taking out a standard credit card, which she would have had to pay back with interest.
Woman gets behind on payments and faces interest rates of over thirty percent
Woman was unable to pay for boat loan because of a medical emergency caused by financial distress. She lost the boat and had to start over with a new one. It can be tough to make ends meet when you are struggling to pay your bills, so make sure that you know what you are getting yourself into before taking out any loans.
For the sake of those who find themselves in a similar situation, here are some tips to help you avoid the same fate.