Thursday, July 30th18.3°C
Guest Columnist

Personal loan right for you?

From purchasing a vehicle to renovating a home to covering an emergency, we all have different financial goals. For those without the immediate funds to achieve these goals, taking out a personal loan can be the right way to go.

Let’s examine a few situations where a personal loan might be something for you to consider:

You want to renovate your home:

Improving your home is almost always a wise investment. If you have a project in mind that will add value to your home (such as an extra bathroom or a revamped kitchen), a personal loan can be a great way to finance it without tapping into your equity. The right home renovations can definitely provide a solid return on your investment.

You run into unexpected emergency expenses:

If an emergency expense blindsides you, consider borrowing from a line of credit. A line of credit gives you access to a pool of funds that you can use whenever and however you need. You're free to borrow for any reason, at any time. You’ll save yourself a lot of stress by getting immediate access to funds to cover your expenses.  

You want to purchase a new or used vehicle:

Many of us don’t have the cash upfront to pay for a vehicle outright. In these instances, an auto loan can be an appropriate way to finance the vehicle. As an added benefit, having a paid-off auto loan on your record often means you will get a better rate when it comes time for you to take on a mortgage, as this finance writer figured out.

And of course, each of these loans offer another bonus, if you are able to repay on time—an improved credit rating.

Prospera Credit Union offers distinct loan types based on your needs. As outlined in this Bankrate article, getting a loan through a credit union instead of a traditional bank can be a far smoother experience for the consumer. Credit unions have the reputation of being friendlier and more community-oriented than traditional banks. They’re interested in serving their members, and can help you with a loan.

Here are some guidelines to heed when taking out a personal loan:

  • Generally speaking, taking out a loan for something like a personal vacation is not recommended.
  • Before you decide to borrow money, think about your motivation for wanting the loan. Will the money be used wisely or impractically?
  • Limit the number of loans you apply for. Most loans leave a “footprint” on your credit record, which lenders will check before approving your latest loan. Having lots of applications on your record might make you seem like someone with perpetual financial difficulties, which causes lenders to view you as more of a risk. 
  • Make sure you can pay the loan back on time, but also be aware that some lenders apply an early repayment charge if you settle your loan ahead of schedule.


Wearing plastic bottles

Are you wearing a former plastic bottle? You could be, if you’re wearing a fleece jacket or vest. Fleece clothing is made from recycled polyethylene terephthalate — or PET. But how does a plastic bottle go from your recycling to a cozy new fleece jacket? 

After your recycling is collected, it’s sorted with similar materials and compacted into bales. It’s important that bales consist of only the same material to optimize their recyclability. Bales are sold to material remanufacturers who process the contents into something that can be used again. For example, bales of PET are shredded, washed, and pelletized.

These pellets are heated and spun into fibres, which are then processed into fleece clothing and other new products. Fewer new resources are required in the manufacturing process when starting with recycled materials. 

There are many different end-uses for plastic containers, which depends on the type of plastic. Milk jugs — high-density polyethylene — are used in new packaging for shampoo or detergent bottles. Plastic bags — polyethylene — are used in plastic decking. Margarine tubs — polypropylene — are used to make storage bins. Each of these plastic types — or resins — follows a similar process of being shredded, washed and pelletized before they can be used again.

Metal cans continue on to become new products or new cans. In fact, anything made from steel in North America has some recycled content, and recycling metal uses less energy than producing new metal. That means your empty can of peaches could re-enter your home when you replace your next appliance. Like plastics, metals need to be sorted into different types. Once sorted, the metal packaging is shredded and smelted. It can then be rolled into sheets, wire, or bar, and used to make new cans, car parts, or construction materials.

Paper is pulped and pressed into fibres that become cereal boxes, egg cartons, and cardboard boxes depending on the mix of papers.

Recycling residential packaging and printed paper in British Columbia is made possible by Multi-Material BC (MMBC), a non-profit organization that collects fees from the retailers, manufacturers, and other companies that sell or provide packaging and printed paper to residents. MMBC manages the recycling and collection of the packaging and printed paper on behalf of these companies removing the financial burden from municipalities. This is called extended producer responsibility, or EPR.

There are over 20 EPR programs in BC, for materials such as tires, batteries, lights, electronics, and more, each of which provides BC residents with management options and avoid disposal, filling up landfills. Help give your packaging and printed paper a second life by recycling it.


Truth about consolidation

Debt is a drag. Every month, multiple bills clutch at your purse strings, demanding your full attention. Staying on top of each one can be a daunting task. A debt consolidation loan might be the solution you’re looking for. It involves managing one monthly payment instead of several payments.

Here’s how it works: A financial institution extends you a loan that equals your outstanding debts to some or all of your existing creditors. You then use the loan to pay off your debts to those accounts, and are left with a single loan to repay to the financial institution.

If you’re interested in merging everything into one easy-to-manage payment, here are some of the advantages of a debt consolidation loan:

One payment per month makes budgeting easier

Replacing multiple payments with a single payment should make it easier to plan your budget each month. One payment equals less time spent planning.

Save money with a lower interest rate

Most consolidated loans have lower interest rates than credit cards do, so you may be able to reduce your interest payments by consolidating. This will save you a lot of money in the long run.

Protect your credit score

A consolidated debt loan can also improve your credit score. If you often make late payments on your accounts, your credit score will certainly take a hit. Streamlining to one payment and staying on top of it will help you rebuild a damaged credit rating.

Get some peace of mind

You’ll also feel less stressed. We all know that debt is a real soul-sucker, and one of the most common causes of stress. Knowing that you only have one payment to make each month allows you to feel more in control of your financial situation.

You’ll want to shop around for the right debt consolidation loan, as the interest rates offered by assorted banks and credit unions can vary. It doesn’t cost anything to apply for the loan itself, but a fee may be charged to open your file with the lender. This is where tools come in handy. Prospera Credit Union offers a debt consolidation calculator that helps you determine whether consolidating your debt into a single loan is the right choice for you.

A final tip: Prospera recommends applying a portion of your consolidated loan’s monthly payment savings to the balance of the loan itself. You can save hundreds to thousands of dollars doing this, and knock years off of your loan. Find out how to do this with their debt accelerator.



Stay happy on road trips

If a family road trip is on your radar this summer, you’re not alone. With gas prices expected to be relatively cheaper than previous years, this may be the perfect time for you to pack up the kids and hit the open road.

Rob and Bonita Tang are no exception. With the birth of their second child, they realized how expensive air travel would be if they wanted to vacation out of town.

As a child, Rob was no stranger to exploring North America by car, having driven throughout the continental US and many Canadian provinces. 

“I still fondly remember the road trip in 1996 that my parents, sister, and I took from Vancouver to Atlanta,” Rob recalls. “We drove all the way there for the ’96 Summer Olympics, then continued onto Arkansas, Florida, Louisiana, and Texas before heading back home to Vancouver via Nevada, California, and Washington”.

It was now his and Bonita’s turn to carry out the tradition of a family road trip with their own kids.

“As a car enthusiast, I like driving and the freedom of the road, so I really enjoy long road trips anyway,” Rob said. “When you fly, you get from point A to B quickly, which is great for efficiency but you miss out on the adventure of discovering surprise locations along the way”.

Bonita added, “On an airplane, we would be much more limited in what we could bring there and back because it all has to fit into checked baggage. But when we take our Honda minivan, we can even bring four sets of skis, which would cost a ridiculous amount to bring on-board a flight. Plus we don’t have to worry as much about running out of room when we go out-of-town shopping”.

“Keeping the kids from being bored is one of the keys to a harmonious road trip,” she advises. “Rob and I always try to keep them occupied with low-tech games, such as I-Spy or Checkpoint, which promotes them looking out the windows at their surroundings rather than in their laps”.

However, on their recent two week, 3,500+ kilometre journey down south to San Francisco, Reno and Lake Tahoe, the Odyssey’s rear DVD player proved to be invaluable. Their kids, Andrew and Olivia, enjoyed watching movies together using wireless headphones while their parents relaxed up front.

In a day and age where tablets and smartphones are everywhere, it may seem surprising that auto manufacturers still continue to offer factory rear entertainment systems. Rob is hopeful that they will continue to do so.

“I like the parental controls up front and it is just one less thing to pack or lose,” he explains. “Also, unlike tablets where the kids are always looking down, the built-in system flips down from the roof so the kids are looking up and can still see the surroundings in their peripheral vision”.

Traversing the country by car also requires some advance planning as far as vehicle maintenance. It may be tempting to get some miles on the car then have it serviced after the road trip. However Rob advises this is a mistake.

“The last thing you want ruining your vacation is to be stranded at the side of the road in an unfamiliar town,” he says. “I always have our vehicles serviced at the dealership beforehand for preventative maintenance”.

His line of thinking seems to be right on the money as the Tang’s minivan has been trouble-free even after crisscrossing the US and Canada.

To that end, here are Rob and Bonita’s top tips to keep the kids happy, the parents sane, and to ensure that your next family road trip will prove to be memorable for all the right reasons.

  • Flexibility is king. Pick a destination and book your accommodations in advance, but leave yourself enough time to explore the surrounding areas on-route to your goal destination.
  • Get the whole family involved in planning, especially the kids so they’ll know what to expect and how long it will take.
  • Keep the kids occupied with both low-tech and high-tech activities.
  • Plan your fuel and restroom stops in advance.
  • Get the family vehicle checked out by a trusted mechanic before leaving home.
  • Set aside enough time to pack your bags, load your vehicle, and get a full night’s sleep so you can start your adventure refreshed.



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