Borrowing Money: Understanding How Personal Loans Work

Finance and the finance system is one of the most complex and difficult things to understand in our society, but it is also one of the most important. Money is one of the most important things in our society as it determines so much about our lives and people work 40+ hours a week to make sure that they have enough money. It determines what our quality of life is like, if people have a lot of money, they tend to have less stress and their quality of life is higher as they can afford luxuries such as holidays, clothes, and cars. If people don’t have much money they tend to be more stressed as not only can they not afford the luxuries that help to improve quality of life, but often they can’t even afford basic necessities like their rent, food, and heating. As money is so important, this makes anything to do with finance important, but often people struggle to understand the finance system as many people aren’t good with numbers. The finance system covers everything from how national banks work and how they operate to control things such as the inflation rate, to how to make the best investments to diversify your investment portfolio to how loans and borrowing money works. If you’re in a position where you need to borrow money, whether this is to invest it to make more money or it’s to make ends meet, we’ve found all the information you’ll need to understand how personal loans work.

What is a loan?

A loan in some circumstances is very useful, it is a commitment between two parties, usually a company/individual and a bank or loan company. In this agreement one party will lend the other party an agreed amount of money, A loan is beneficial to both parties as the company or individual may have no other way to acquire capital so this is helpful to them and, loans are paid back with an interest rate which benefits the lender as they’re making money.

How interest rates work

Interest rates are always changing and they’re really important as if you have a high-interest rate on your loan it can become difficult for you to pay it back. An interest rate is attached to the loan and is written clearly in any loan agreement that both party’s sign. There is a simple interest which means each monthly repayment will be the same as it will be a percentage of the whole loan or compound interest which means it will be a certain percentage of how much is still owed of the loan. Interest rates are determined by many different factors and some loan agreements state that the interest rate is subject to change over the length of the loan agreement.

Different loan types

There are many different types of loans available out there for people or businesses to borrow. A personal loan is one type of loan and in its simplest terms is a payday loan that is guaranteed. These loans on average are paid back over 12 months but can be paid back for as long as 84 months in some cases. Some other types of loans include credit card loans, which act as an overdraft, student loans which can only be used to pay college fees, car loans which are used if you’re wanting to buy a car on finance and small business loans which are an incentive to help small companies as it is difficult to start up a small company.

What is loan collateral?

Loan collateral is something that is used to protect the lender when 2 parties agree to a loan agreement. As there is no guarantee that the borrower will ever pay back the money, the lender can take assets such as houses or cars as loan collateral as both an incentive for the borrower to pay the money back and as protection for if they don’t. If the loan is not paid back, the investor can seize the asset is as a way to get back some of their lost money.

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All the Reasons you Should Get your CFA Charter in 2021

For those of you that are not already aware of what a CFA charter is, it is basically a very well-developed qualification that is one of the hardest that a business and finance graduate can get. Although this qualification may be one of the hardest out there, it is definitely worth it if you are able to get it and achieve a high grade within the examinations. For somebody who is unsure of what they want to do after they graduate this qualification would be a good option as it is something that is best worked on when you have no other big responsibilities in your life as the research and preparation process for the exams will take up a lot of your time. 

 

There are many reasons in favor of your getting this qualification however, I would highly recommend that you do plenty of research into what you will have to do to achieve this as it is one of the exams with the biggest worldwide failure rate ever. With this in mind, there is plenty for you to consider and I would recommend that you take a realistic approach when thinking about taking your CFA charter.  

 

Experience

One of the biggest reasons that you should consider getting your CFA charter would be the experience that it provides, with so many people doing badly on the exam and its recognisability as being one of the most difficult qualifications you can get, the experience that is provided by even attempting to get this qualification is going to be something that you cannot get anywhere else. Even if you are not as successful with it as you once thought you would be, the fact that you are putting in the effort to revise and attempt the assessment will provide you with a  lot of unique experience that many others in the industry do not have. 

 

Having this experience is all going to help you with putting together a solid CV with plenty of different things to talk about in any potential job interviews you have coming up. With any attempts at this qualification, you are not only showing that you are skilled enough to attempt such a big exam but also that you care enough about your progression in finance and business to give it a go, which is both great qualities when looking for employment.  

 

Research

As mentioned previously this qualification is not easy to get, you will need to ensure that you have saved yourself plenty of time to go over everything that you have learned during your previous studies, as well as ensuring that you purchase the relevant study guides and stick to a hardcore revision schedule up until the date of your cfa level 1 mock exam, even the mock exam will require you to do a lot of preliminary research and it is a great thing to do to establish where you are at with your studies and looking for any areas that need improvements.  

 

Sticking to a large research and revision schedule is very important for you to do well on the exam, but even if you do not do well you will still be extremely well versed in finance and business management based upon the work you have done. This is why it is so beneficial to even give the CFA charter a go as the work you put in towards the qualification is going to be very useful later in life and help make you stand out when employers are comparing your CV with other graduates.  

 

Recognisability

Another reason why you should definitely look at getting your CFA charter this year would be because it is so recognizable within the industry, when you finish your official studies and graduate it can be hard to know what to do. Taking the time to revise and complete your CFA charter is something that you can do which will further your career as well as making sure that you are not wasting your time by doing things that are not as beneficial for you. If you have on your CV that you have even attempted the charter it shows that you care about going further and getting extra qualifications within the industry.  

The business and finance world is one that is filled with hopeful graduates every year, as the course is so popular this means that there is a lot of competition against you in terms of finding work in the sector that you want to work within. Having such big qualifications like this will make you stand out completely from the crowd and for those of you that are unsure about the employment after education process, having another few months to figure things out could be just what you need.  

 

Management

If you are able to secure your CFA charter it is likely that you are a very advanced candidate for higher-paying work within the industry, the fact that you are able to complete and achieve a good grade within this exam shows that you have the potential for positions like manager within a finance company. It is no small feat to complete this charter with a good grade so don’t downplay your success by going for a lower-ranking position. Employers will appreciate your authority and skill and it is likely that you will get the job you desire.  

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The Most Financially Competitive Cities in the UK

If you’re thinking of starting a finance business then one of the toughest decisions to make is where to set it up. A popular choice of country to set up a finance company is the United Kingdom. The United Kingdom has a strong economy which is vital to ensuring the long-term success of your business and they have a massive financial industry. The finance sector in the UK is one of the best in the world, it is estimated that this sector brings in upwards of £130 billion and is a huge 7% of the country’s total economic output. This makes it a great environment to start up a finance business, there are many successful finance companies in the UK, they have been given the title of the finance capital of Europe which is huge considering how great Germany and France’s finance sectors are. The city you choose within the UK will also massively impact how well your business does, starting your business in a city, not a town is obviously the way to go but deciding what city can be difficult. To save you from doing lots of research we’ve found the most financially competitive cities in the UK for you. 

 

London

London is the capital city of England and it is one of the busiest cities in the world and is a massively popular tourist destination. This is a city that has a reputation on the global stage and is almost as competitive as places like New York and Tokyo. There are two major financial districts in London: The City of London and Canary Wharf.  Whilst both are internationally recognized as important and successful finance districts The City of London is slightly more important as it is home to the Bank of England and the Stock Exchange, both of which are extremely important in the finance sector. Another great thing about London is that it is in a great location, whilst London will likely have everything you need to run a business, if you set your company up in London, you’ll be able to take advantage of services being offered in other cities and towns close to London. For example, one of the most important things to help improve a business’s chance of success is to make sure that you’re using up-to-date technology. If you’re not tech-savvy then you’ll have to pay someone else to take care of your tech needs. If you set up your business in London then you’ll be able to access a Watford based IT support company as they’re known to provide some of the best services in the whole of the UK. However, rent prices in London are extremely high as is the cost of living so if it’s too expensive for you to set your business up in London, there are other great cities too. 

Manchester

Manchester is another major city in the UK, it is one of the most popular cities in the UK as it is filled with great culture and is one of the biggest northern cities. As it is located in the North this means that everything you need for your business will be much cheaper and rent would be significantly lower than it would be in London. Their major financial district is called Spinning fields, this has seen a lot of growth over the last decade, there are now double the number of workers there than there was ten years ago. Many big companies are choosing to start up in Manchester instead of London and Manchester is predicted to be the home of FinTech in the UK which is the future of finance. More graduates than ever before are also choosing to stay in or move to Manchester as an alternative to London, this will help the cities financial sector to continue to grow. 

Edinburgh

Edinburgh is the capital of Scotland and is another major city in the UK. It is one of the 2 biggest cities in Scotland and is home to over 50% of Scotland’s whole financial sector. Edinburgh has the 2nd biggest financial district in the Uk, second only to the City of London. This is another city that is recognized on an international level as they have the 4th largest financial sector in Europe. This is another city where lots of FinTech companies are setting up, whilst Manchester is leading in this area Edinburgh is seen as another alternative to London. If you want to set up your business in a busy city with lots of potential clients and lots going on then Edinburgh is the perfect place as it has the busyness of a capital city without costing as much as London.  

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Fixing your Budget: How to Trim down your Expenses

This last year has been a particularly difficult year for many people as the majority of the population have been living in and out of lockdowns with their places of work being opened and then closed again every few months. This has left a lot of people feeling financially unstable and many people are struggling as they’re earning much less than they’re used to. Whilst only the end of the pandemic can allow the economy to boom again and to help lessen the unemployability number, many people have been unable to wait for this and have found side hobbies to make money. Many people have learned a new craft and sold their products, whether this is learning how to bake and selling birthday cakes or if you’re a painter with more time to paint so you’re selling some of your art, all types of art have been successful. Others have found work from home jobs in a new field, some people have learned about the stock market and others have learned how to code, all to earn an extra income. If you’re struggling but don’t have the time or equipment to create a side income, then you can still trim down your expenses and make managing your money much easier.

 

Look at your contracts

Every single month people overpay for things that they don’t necessarily need or could easily live with a cheaper version of. For example, if you have the newest cell phone with unlimited data, texts and minutes then you’re likely paying around $80+ every month when if you need to cut costs you could purchase an older phone with a contact that just has the data, texts, and calls that you need. Another example of a contact that you’re overpaying for is your broadband, whilst you might have the fastest broadband at the minute, if you don’t work from home and just use your internet for YouTube videos and social media then you don’t need the fastest broadband and could get a cheaper one. Sometimes, however, broadband companies can make it difficult to leave so if you’re unsure how to cancel your broadband contract early then give it a quick google search and there will likely be a forum about your provider.

 

Plan

Most people think that if they stop ordering takeout food then their budget will drop drastically, however, this isn’t the case as sometimes you can go grocery shopping and spend more on meals than you would if you ordered a takeout. The best way to cut back here is to do some research and find some nice cheap meals that you’d enjoy and head to the shop with a plan. Decide on a Saturday what you’re going to eat the following week so when you go for your weekly shop you won’t spend over your budget. If you’re struggling to find cheap meals then there are many inspiring recipes online and many YouTubers have created videos of them doing a cheap shop and showing what meals they prepare with the food too.

 

Find free Hobbies and Days out

Another huge expense in your budget will be leisure, every time people want to hang out with their friends it usually involves spending money. Whether you’re buying a bottle of wine for drinks at home or going out for an expensive meal, leisurely activities also involve some sort of cost. To save some money in this area of your life then you can look out for free fun activities for you and your friends, your local drama group may put on a free production of a show or your local coffee shop might have an open mic night where you can see the local talent. By making swaps like this you can still enjoy things like live music without the hefty cost of a gig ticket.

 

Your Home

If you really need to trim down your expenses then trying to reduce the biggest cost is the best way to do this. Most people’s largest monthly expense is their rent or their mortgage, if this is the case with you then there are a couple of options on how you could trim this down. If you have a spare room in your home then you could either find a roommate to occupy it or you could advertise it on a website like Air B&B, this way you’ll either split the rent with someone or have additional income to put towards the rent from visitors who stay. If you don’t love the thought of sharing your house with someone then you can downsize where you live so your monthly expenses will be lower. If you have a family and can’t downsize then you could look for a similar house in a cheaper area until you’re back on your feet.

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Why Are more Companies Accepting Payment in Bitcoin

The list of companies that accepts bitcoin as an official form of payment is continuing to expand. For those of you who don’t know, bitcoin is a type of cryptocurrency. A cryptocurrency is a form of digital money that people use to buy goods and services. It is a decentralized currency which means that no one person or government has control over it like they do with the dollar or the yen.

A bitcoin is basically a digital file that is stored in a digital wallet, it can be transferred in the same way as normal money and each transaction is recorded digitally. Bitcoin is the most popular and most well-known type of cryptocurrency as it was the first blockchain type of cryptocurrency created back in 2009. After bitcoin became well known many investors invested a lot of money into it making the value of bitcoin spike. The spikes and falls of the value of bitcoin have confused investors as the trends are almost unexplainable, however, even now in 2021, the value of bitcoin is still rising. Bitcoin is now valued at above $20,00 and is increasing in popularity, read on to find out what companies accept payment in bitcoin and why more companies are beginning to accept it.

 

Why it’s good for a company to accept payment in bitcoin.

Generally speaking for any company, the more different forms of payment the more customers they begin to attract as people with have different payment preferences so it’s best to accommodate for as many as possible. The most common payment forms that most companies offer include Visa, Mastercard, and Paypal. It’s good for a company to accept bitcoin as payment as the other methods have higher transaction fees. Mastercard, for example, charges anywhere between 1.55% to 2.6% per transaction and all other credit cards will have similar fees. Cryptocurrencies allow customers to avoid many of the transaction fees that all consumers hate such as overdraft fees and foreign transaction fees. While bitcoin does incur a fee, the fee is considerably lower, usually around 0.5% of any transaction. This is more appealing to consumers so by offering bitcoin as a way of paying a company will gain a competitive advantage over companies similar to them which will help their business to thrive.

 

What companies are accepting bitcoin.

Over the last 6 years, the amount of companies accepting bitcoin has payment has massively increased. The latest survey took place in 2020 and the results showed that 36% of US businesses had started to accept bitcoin as a form of payment. Some major companies that accept bitcoin include Wikipedia, Wikipedia are responsible for the largest ever open-source encyclopedia, they rely on donations to operate and have begun to accept donations in the form of bitcoin via BitPay. Microsoft is another major company that allows its users to pay with bitcoin, they allow you to top up your Microsoft account with bitcoin.

As well as major companies many multinational stores also are starting to accept bitcoin as payment. These include places such as Burger King who in their Venezuelan stores and their German stores accept bitcoin when ordering online for delivery. Also fast-food chain KFC marketed a ‘Bitcoin Bucket’ in their Canada stores and accepted Bitcoin as payment for this. Other companies include Overstock, Subway, Norwegian Air, Miami Dolphins, 4Chan, and Amazon. If you’ve invested in bitcoin and haven’t been spending it, well now you know that you can use it to buy anything from your weekly takeaway to airline tickets you can findbitcoinatm and start spending.

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