For so many ending up with little money at the end of the month to save isn’t a matter of choice. In fact, at the beginning of each month, we resolve to have a significant portion of our wages left over to place in a saving account. However, when the 30th or 31st roll around it has all disappeared, and it not because of bad finally planning on your part either. In fact, it is the hidden yet unnecessary costs that you are paying! Keep reading to find out more.
Poor credit score costs
One of the of the most insidious and harmful hidden costs that you can come across is the increase in interest that you can end up paying when you have a poor credit score. Yup, that’s right they charge people with a worse financial situation more, because they have more of a higher risk of not being able to pay the money back.
In practice what this means is that those that can least afford high-interest rates are charged them. Something that not only can further damage your financial situation, but also drain any additional money you are hoping to save at the end of the month.
That is why interest rate checking and vigilance is an approach that is preached throughout this post, is vital here.
Car insurance penalties
Penalties for services such as car insurance and other types of hidden costs that you need to look out for. These are often charged on accounts that have a poor record and include multiple previous claims or even in some cases, DUI charges.
In fact, folks with such a driving record can find it hard to get insured at all, let alone get cover at a reasonable price as well. Luckily, Servo insurance brokers high risk car insurance is one of the few options on the market that ticks both boxes. They even offer flexible monthly payment plans that don’t charge additional interest on the quoted cost. Something that means you can get insured and still have some extra money left over at the end of the month to top up that saving account.
Bad choices in credit providers
Hidden cost issues are also applicable not only to those with poor credit ratings, or driving histories but also to anyone that uses the credit system at all.
The reason for this is because credit providers are commercial companies and their main aim is to make money for themselves and their shareholders. What this means is that there are some loans and credit provider that charge high rates on interest not because of the risk of the loan, but just because they can. Something that you can often see in payday loans.
Obviously, this means if you get into a situation where you need credit in this form you must do your homework on charges and rates before you sign on the dotted line. Otherwise, you could end up thinking that you will have money to save at the end of the month that will end up being swallowed these hidden and unnecessary costs, leaving you out of pocket.