There are two basic ways people make money: by working for it and by making your money work for you. Learn the differences between these two strategies and how you can optimize each approach to build your financial portfolio using the proceeds of your short-term loans.

Work for Money

If you’re employed, that means someone else is paying you to do your job. Many employees use short term loans to meet their employment-related needs, such as-

  • Travel expenses
  • Daily meals
  • Clothing
  • Advanced research or studies. A lot of employees take short-term courses that are not sponsored by their company because they simply wanted to increase their knowledge and skills in performing their roles in the company. Executives and team leaders also pursue their master’s degree, and take advanced diploma courses not only to obtain promotion but to be able to teach and manage their teams.

Here are other common expenses of employed individuals:

  1. Entertainment. It matters. Two reasons why: One, because without it, life would be BORING, and Two, because, honestly, could you imagine living in a world full of workaholics and dullness? No. So even if we’re having the hardest time at work, we take vacations and night outs to ease the stress, even just a little bit. Although, it is quite expensive, which is why entertainment is considered as one of the things that retain a person’s financial standing.
  2. No matter how much we want to cut down on the gas, we are forced to keep our tanks full- unless you want to pull up on an empty highway in the middle of the night- well that would be creepy. Gasoline prices have risen through the years and are now at its peak. In an urbanized community, we are entitled to travel on wheels- may it be the local bus station, or your own personal vehicle. Even if you’re riding a bus, you’re still paying for the gasoline-through your fare. Having your own vehicle isn’t any better. You pay for the entire gasoline fee, only to use it all up at the end of the day. Now, these are what affects our daily expenses- which pull down or retain or financial statuses.

The most common business-related expenses of self-employed borrowers include the following:

  1. Your cash flow and bills both depend on the kind of business you have. If it’s a Grocery Store or Repair Shop that you put up, the rent or mortgage of the building is one of your major expenses. Sure, the payment is fixed, but sometimes, when you’re short on money; the other bills are left unpaid which drowns you in an ocean of debts.
  2. Utility bills. The water company just called, they want their payment or else they’ll stop your water supply. How would you react, now? Having your own business is hard, especially when you’re all alone, with ABSOLUTELY no one you can entrust with the job you’re doing. Drawbacks like electricity and water bills may affect the business’ financial status. Paying them off can be such a hassle, especially when your business is just starting and the bills are constantly flinging themselves at you.
  3. 3. Insurance. Smoke puffing out of your building’s windows isn’t a good sight to see, having insurance for the building, as well as your employees should be necessary. You never know when the water company would cut off their service- when you fail to pay them, that is- and you’re left with electricity sparks and smoky building pieces.
  4. Let money work for you

You take your short term loans and you save it for the future or invest it to generate income.

Here are some of the benefits of saving money:

  1. Saving means having money for reserve in case you need them. Which also helps you decrease your debts- because honestly, when you have money, you have absolutely no reason to take out that credit card and drown yourself in bills.
  2. You develop responsibility. Having to save means having self-discipline-which also allows you to become financially responsible. Big word right? Well, your credit score may say otherwise, but when you save, almost automatically, the word responsible is added to your vocabulary.
  3. Sometimes, we could be forgetful. We forget how much we have spent via credit card and come to shock when the bill comes. Knowing how much-exactly-you owe the bank helps you identify how and how long you would pay them off. Recognizing your debts help you recompense them in a jiffy. With the help of saving, you could pay your debts in no time. You may not be able to pay them in full, but with a little more bucks stuffed in your account; those debts would be gone in no time.

Whether you intend to work for money or to make your money work for you, short terms loans are viable tools you can use to grow your financial resources.

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