Poles prefer cash transactions

Although nowadays financial institutions offer more and more modern solutions thanks to which we can pay in a fast and comfortable way, cash is still very popular among Poles. Our country is one of the European leaders in terms of payments with physical money. What is the reason? Read!

PLN 215 billion in the form of banknotes and coins circulates in the circulation of the Polish economy!

 

We can use an increasing number of modern financial solutions

We can use an increasing number of modern financial solutions

Many Poles still make payments in cash. According to the data collected by Dennis Grata, an amount of PLN 215 billion is circulating in the circulation of the Polish economy, which consists of banknotes and coins only. Such a huge amount gives as much as 10 percent. GDP!

Currently, Poles are among the European leaders in terms of cash payments, only Greeks and Hungarians are ahead of us. Interestingly, until recently before our country were m.in. Italy, the Czech Republic and Slovakia. Everything indicates that soon we can become a society that will be most willing to use physical money throughout Europe.

 

Why do Poles prefer to pay in cash?

Why do Poles prefer to pay in cash?

What is the reason for the growing popularity of cash in our country? Why are so many of us reluctant to pay by card or using modern financial solutions, i.e. mobile applications? The answer to these questions is not clear, because this phenomenon is due to several factors.

The most important reason why Poles willingly pay with banknotes and coins is that banks impose too high interest rates and potential clients do not want to lose their money on servicing an account or payment card. Other factors that affect the popularity of cash are: the growing earnings of Poles, greater stability on the labor market and social transfers.

An important factor that causes more interest in payments with physical banknotes and coins is also the fact that most Poles began to save and accumulate more and more money. This is confirmed by the data collected by the Central Statistical Office and the Rose Bank.

Credit Holidays

Credit holidays are a period of credit commitments, during which the borrower pays only the loan interest or only the principal amount of the loan without interest to the creditor, however, the first type of loan holiday is more advantageous for both the borrower and the lender, therefore it is more popular and widely used. Credit lenders are both bank and non-bank lenders, but it must be admitted that in both sectors credit holidays are also used as a marketing trick, which borrower would not be interested in paying principal or interest for some time in their credit commitments, but not all that easy – credit holidays are granted only in certain cases, which will also be discussed below.

 

Credit holiday function

Credit holiday function

Of course, credit holidays are not used as a marketing trick primarily – the primary credit holiday function is to reduce the borrower’s credit burden in situations where, for example, it has been out of work, there has been an increase in the family, sudden and significant income losses or other financial difficulties or problems with repayment of the loan. If the borrower has any financial problems and creditworthiness, he / she must definitely contact his or her creditor for advice and be informed of the problem situation to find the most appropriate solution. It should always be remembered that obtaining a credit holiday is in the interest of the borrower, so do not wait for the credit provider to offer you a credit vacation, but act on your own.

 

Apply for credit vacation

Apply for credit vacation

However, before applying for help and asking for a credit vacation, you need to know some of the prerequisites for granting credit holidays. The loan amount must be at least 1400 EUR to get a credit vacation . If your loan amount is greater than mentioned, and you are in an insolvency situation, you can contact your creditor and ask for a credit vacation. If you have lost your solvency as a result of losing your job, you must obtain the status of an unemployed person by registering at a branch of the State Employment Agency. Credit holidays are granted for a specific term and depend on the individual situation of the borrower.

Indeed, in the case of a serious situation where, for example, there is no job and no prospect of obtaining it in the near future, not only interest payments but also principal payments are canceled for up to 6 months. It should be noted that credit holidays can only be obtained once per calendar year. It should be emphasized that, after the credit holidays, the monthly payment of the loan increases slightly (by 0.5% to 2%) , making the total cost of the credit more expensive, so the credit holidays should be used in case of a serious need rather than for abuse, which can then be costly.

 

Credit holidays are an expensive and risky service

Credit holidays are an expensive and risky service

So the interest rate on these factors is slightly increased to compensate them. If, for one reason or another, you are not granted a credit vacation, it is the responsibility of the creditor to offer you another solution to ease your financial situation, such as applying a different repayment schedule or terms.

Financially deciphering men

Men are impatient by nature; They hate ranks, crowds and go searching for the item they need. This would lead us to think that they are rushed and avoid making comparisons between the products they are going to buy.

However, and to our surprise, they are more rational and prefer to wait until they find that object or service that, in their opinion, meets the expectations they are looking for. For this genre, it is common for purchase decisions to be based on the reason, the comparison and the price they are willing to pay.

How are your finances?

money coins

Despite comparing prices and being not very emotional when making their purchases, men often have “small expenses” that if they are not controlled can become a big problem for their financial budget. These “small expenses” are not usually important but considered urgent and justified; The seriousness of the matter lies in the lack of control of these expenditures, since generally the money allocated to these purposes can vary considerably, which makes it impossible to include them in the budget. Within the “small expenses” we can find: meals outside the home, transportation and alcoholic beverages.

What do they buy?

Most men spend their money buying:
1. Sports elements (clothing, guayos, balls)
2. Technological devices (tablets, mobile devices, video games)
3. Clothing (Shirts, pants, shoes)
4. Gifts (Flowers, chocolates, invitations)
5. Alcoholic beverages

How can you optimize your money?

money cash

Men are very good at making a general balance of their finances, but they need to be a little more aware of the expenses that seem not to be significant because that is where their deficit is month to month. A good alternative to control these expenses is:

Make a list of expenses that seem not to be as important, such as weekend trips, invitations or gifts. To allocate a monthly item to these activities and include them in the budget of the month. Men are technology lovers, so downloading these free apps can be a great help:

Pocket Expense Lite

It is a complete finance software that helps track what happens with your personal finances. Pocket expense classifies transactions, invoices and adjusts budgets so that you can reach your savings goals.

Cashflow. It is a simple asset management tool that will allow you to manage your daily income and expenses. With this application you can register operations in an easier and simpler way.

 

Which is better: home loans, bank offers, or home savings?

The fact is, they have 3 2 year home savings contracts and would like to borrow 12 million because the new home they look for costs $ 31 million.

The question is whether to take out a traditional home loan or use a home savings that has not expired but has been saved for 2 years?

Here’s the answer

bank

The question is multifaceted, with significant details missing, but let’s examine what to expect when choosing to use home savings before maturity, or what to do when analyzing a home loan ?.

1. If you count on LTP, $ 12 million gives you more options.

  • eg. Three 6-year LTP contracts are also associated with a 6-year home loan maturity, and since the home savings are paid for 2 years, the total term is 10 years repayment.

2. Another option for LTP

  • the so-called bridging loan is HUF 12 million. This is HUF 12 million with contractual home savings and a saving of HUF 48 thousand per month. If the loan applicant can still pay the monthly 3D LTP, which is a saving of HUF 48,000 per month, then the income will allow him to take out a loan of 12 million

What can a “traditional” loan provide?

bank

Under the following conditions:

  • a total of HUF 31 million is needed
  • A loan of HUF 12 million is required
  • We expect a 10-year maturity
  • We look at 5 and 10 year interest rates
  • monthly family income 400.000 HUF
  • use of own bank or income directed to the creditor bank and opening an account

3. With this in mind, the expert recommends a consumer-friendly loan that is a 5-year fixed-rate loan with 4% interest rate, a 10-year term and an initial monthly repayment of $ 120,000.

4. If we follow a fixed consumer-friendly scheme for 10 years instead of 5 years, we will charge 5% interest and a monthly installment of $ 129,000. If we had more information, we could detail the options for an instant loan with LTP.

Back to the bridging loan, what do we need to know?

bank

  • The monthly income is often high, at least HUF 400,000
  • In terms of interest rates, they can be more favorable than home loans, according to the expert, even the best home loans, consumer-friendly loans, outperform!
  • Significant interest on an immediate loan is payable only at the end of the initial period, at the end of the period, at the time the loan is obtained, less interest, currently 4 years higher, 6 years lower, associated with the home loan
  • The interest is discounted, but all additional costs must be paid, such as disbursement, notary public, appraiser fees. These costs can be up to 1% of the debt.
  • It is important to compare the 2 options, instant loans and best home loans before deciding.
  • Also keep in mind that if they can pay LTP for at least another 2 years, it is worth borrowing a bank loan, as in this case they enter into a state-subsidized discount so they can pay off their loan by shortening the repayment period.

According to expert opinion, it is best if you can pay LTP for up to 2 years with the consumer-friendly loan you have taken and then put it back into the loan! Banks are offering much better rates than bridging loans, while LTP repayments reduce the repayment and they can also make a prepayment free of charge if they require a consumer-friendly loan in advance.

 

The annuity loan

The annuity loan is a loan that is most frequently requested in Germany. The name derives from the fact that the rates are called annuities. For this particular loan, the installment payable consists of an interest and a repayment installment. Especially the annuity loan, because here the monthly payable rate always has the same amount. The interest rate on the annuity loan is fixed for the life of the loan. Another special feature is that the so-called initial repayment steadily increases despite the constant monthly rates. The increasing repayment results in this case, because the remaining debt continues to fall, the further the maturity has progressed. The lower residual debt then bears interest at a constant percentage, so that the portion of the repayment increases successively.

 

Advantages of annuity loan for the borrower

Advantages of annuity loan for the borrower

Through this special calculation of the interest, the borrower can enjoy various advantages. Above all, he can make better planning by the constant monthly load. In addition, he can not lose track of his payment obligations. He can plan his monthly repayment burden on an annuity loan over a long period of time because it is always the same. The borrower always has a size to consider in an annuity loan and can adjust other loans according to their financial capabilities.

 

Always compare offers for an annuity loan

Always compare offers for an annuity loan

As mentioned, the annuity loan is a very popular and widely used form of financing. This brings with it the fact that the financial market also holds many different offers. Consumers should always compare the terms of various annuity loans to find an acceptable offer. Consumers should, for example, know that in addition to the annuity loan, there is also the so-called repayment installment loan, which also provides consistent installments. In-depth advice from a specialist should not be missing in any case. Especially if one binds itself by the annuity loan eg as real estate financing over many years to payment obligations.