Having a store card can be very convenient. It can mean that
you will be able to shop in your favourite places and use a card to pay so that
you will not have to pay for items right away. It might also allow you to get
discounts and special offers in store which are not available to other
customers. This can be really great and you could feel that they are really
worthwhile. However, the billing on the store card will give you a selection of
options and it is worth being aware of these and the consequences of them so
that you get the best from your card.
Paying the minimum balance
With a store card you will be able to buy whatever you wish up to the credit limit of the card. Then you will be sent a bill after 4-6 weeks and you will be told how much you owe. You will have several repayment options and one of these will be to just repay a small amount of money plus interest. This means that you can delay paying your card off for a long time but you will pay for the privilege. The costs of delaying your repayment can be really high and it is worth calculating how much these will be. The monthly charge may seem reasonable but if you add this up over a year or longer then it will be a lot of money. It can be convenient as it means that you can buy things now and now have to much very much until a lot later. You have to decide whether it is worth it. How valuable are the things that you are buying to you and if you add up the cost of paying for them later it is really worthwhile?
Paying the whole balance
If you repay the balance in full then you will get all the advantages of the store card without having to pay for them. Therefore, you will get access to the discounts and offers that might go along with having a card but you will have no interest to pay. This is certainly the cheaper option, but it will mean that you will have to be careful with how much you spend. You will need to be aware of what you are buying and how much it costs as well as how much available money you will have to repay the card when the bill comes. You might decide to keep some money by to make sure that you can afford it or be confident that you will have enough as you know your budget well. If you are not that good of keeping tracking of your spending, prices, your own bills and monthly balance then it could be wise to look at it carefully first. Then you will have a better idea of how much you will be able to afford to pay and therefore how much you can spend.
If you already have an outstanding balance on a card then it
may be that you cannot afford to pay it all off in one go. As the repayment
system on store cards is flexible it means that you can repay it in
instalments. You will have to always pay the minimum balance, but you do not
only have the alternative option of repaying the full balance. You could choose
to pay a figure in between. So, think about how much you might be able to
manage and repay that much. You can then slowly whittle down the debt and you
will be able to eventually repay it more quickly. As the debt goes down; the
interest you pay on it will also go down and this will mean that the interest
charged will go down and so you will start saving money right away.
So, in answer to the question it is a really good idea to
repay your store card in full. It will mean that you will save a significant
amount of money as you will no longer be paying the interest on it or you will
never pay interest on it. It can be hard to do this if we overspend and then do
not have enough money to cover the repayment. Therefore, it is really important
that we are able to keep a check on what we are spending and make sure that we
can afford it. When we have a store card we may feel tempted to buy more than
we need, perhaps because of special offers or to shop in that store rather a
cheaper one because of the card and we need to be aware of this and try to
avoid this sort of behaviour. It is not easy but if we are aware that it could
happen then hopefully that will help us.
Getting a loan is never a simple decision and getting a
postgraduate loan can be as tricky. If you want to study then it is very likely
that a loan will be the only way that you will be able to afford it. Although
even if you can afford the course you might still decide that you would like a
loan. It is important to understand how the loans work so that you can make up
your mind whether they are the right choice for you.
How a postgraduate loan works
A postgraduate loan works in a similar way to a student loan. The amount you can borrow is different though as you can choose how much to borrow up to a certain ceiling. This is based on the cost of the average postgraduate course cost. It might be that your course costs a lot less than the average and you will have a lot more money available than those who have high fees and so need to borrow more just to cover the fees. It is possible to only borrow a small amount and then apply for more if you need it so you do not have to decide immediately on how much to borrow.
The loan has no interest charged on it while you are
studying and you do not have to start repaying it until the April after your
graduate. Then you will be charged a percentage of any income you earn over a
certain threshold. This means that if you are a low earner or have no job at
all you will not have to make repayments. The loans are written off after 30
years. It is worth noting that if you have a student loan form your first
degree you will have to repay this at the same time. As both have repayments
based on earnings you will only make repayments to both once you are earning
How to decide whether to get one
It can be tricky deciding whether to get a loan like this. You need to make sure that you will gain from the course that you are taking. It will be wise to think about the career prospects that will open up as a result and whether these are something that you want to pursue. This will help you to think about whether the loan will be good value for money. Although many graduates realise that they may not repay all of their loan as many students do not, it is wise to assume that you will. Then you can really analyse the value for money properly. If you do not end up repaying it all then you can see this as a bonus.
You also need to think about the impact of repaying the
loan. Although you only repay when you can afford it, you will have two loans
to repay if you have a student loan as well. This means that you will be
repaying more money once you are earning enough. This will still not be huge
amounts but it will make more difference than just the one loan repayment. It
is worth finding out exactly how much you will have to repay and when – so how
much a month you will repay on both loans at each pay level, so that you can see
clearly what your obligations will be. This should allow you to consider
whether this will be affordable for you.
If you have enough money to pay it without a loan then you
also have a dilemma. You could get the loan anyway and you may not have to
repay the full amount. You could keep your savings earning interest and then
make the loan repayments when you have to and you could gain a lot of money.
However, you have to decide whether you feel happy with ding that. You will
effectively be using tax payer’s money to pay for a course that you can afford
and gaining interest from that. You are not breaking the law, but it might be
something that you are not really comfortable with. It is good to just consider
how you feel about doing this and also how you might feel in the future.
It is not an easy decision and no decision to borrow ever
is. It is good to think about the value for money that you will get form the
course. Although thinking about your future career is important, also think
about anything else that you might gain from the course as well. Also consider
any impacts the loan repayments might have, especially having to make them
potentially alongside other student loan repayment but do bear in mind that
these are means tested and will only happen if you are earning over a certain
amount of money.