Thursday, June 24, 2021

7 Great Alternatives To A Loan


Pexels. CCO Licensed.

When you can’t afford to pay for something outright, it can be very tempting to pay for it with a loan. Loans are convenient in that they allow you to pay in smaller chunks, however they often come with interest fees - which can result in you paying more in the future. Relying on loans all the time can also cause you to build up debt, which may grow faster than you can pay it back. This can cause people a lot of financial stress.

Loans are rarely ever the only option. Often there are other ways to raise funds without paying interest or even having to owe back money. Below are just a few alternatives to a loan.

Zero-interest instalments

There are some instances where you may be able to pay for expenses in instalments without having to pay interest. Furniture stores, car repair centers and travel agents are just some of the companies that sometimes offer interest-free installment plans - always enquire about these plans. You’ll usually have to pay the cost off over a reduced time period in larger installments than you would with a loan, but at least it will be cheaper (plus you get to pay it off quicker). 

Selling clutter

Could you raise funds by selling unwanted possessions in your home? This could be a great alternative to a loan. You could try selling stuff online, or if you want it sold quickly you could take it to a second-hand store (although you may get less for it by using this approach). 

Employer salary advance

If you’re on good terms with your employer, you could consider asking them for a salary advance. This involves being given some of your future wages early. You’ll have to pay this money back or it will have to be deducted from your next wage, which is something to take into account. Most employers won’t charge interest though, which makes it better than a loan. 


For some expenses, you may be eligible for a state or federal grant. Many people looking to start a business often overlook state business grants - you could be eligible for thousands of dollars and you won’t have to pay any of it back. Look online to see what your state offers (individual cities may have grants to offer too). 


If you don’t need money immediately and it’s for a noble cause such as medical treatment, storm repairs or starting a business, you may be able to raise funds through crowdfunding. This is when people donate money to your cause. In the case of a business, this could be in return for shares, however this is still a better approach to funding than a business loan.

Legal compensation

If you’ve recently been in a serious car accident such as a head on collision or you’ve been a victim of botched medical surgery, it’s possible that you may be able to claim a lot of money in legal compensation. It’s important to know your rights and claim compensation when you deserve it. Be wary that lawyers all have their own fees and that some are more likely to win your case than others. 


If you’re looking to fund a vacation, a new car or a wedding, consider whether you can start saving up for it. Paying for things with your own savings can be much more rewarding than taking out a loan. You can even pay for emergencies with savings by setting aside an emergency fund.

No comments:

Post a Comment

Related Posts Plugin for WordPress, Blogger...