Remember that a theoretically retired person has no extra income other than his or her retirement, so you need to be very careful about this. Let us clarify all the options mentioned so that you can make the right and least expensive choice for your pocket. Be very careful and careful when choosing the best option and be sure to look at all the possibilities and costs of these products. But let us first clarify certain points that will undoubtedly be of great use to the ladies and gentlemen who are about to finally withdraw and have a more peaceful life.
All of us, not just withdrawals, can go through tough times in life, some budget overrun or emergency situations that one could not foresee. What we suggest is a few years before withdrawing start preparing for that moment. This does not require great sacrifices. Quite the contrary, what must be done is the famous “sock”. You can set aside a small amount that your home budget will not need and put it in a separate savings or other application of your choice. Little by little you will be surprised at how much you have already saved. When there is an extra entry or even not spent your 13th salary, put in that application too.
With this, after a few years you will surely have a very interesting capital or “sock”. Don’t be tempted to use this money – forget it – as its sole purpose is to secure a decent or even unexpected retirement at this point.
In the case of credit card and overdraft, it is sufficient to have a good record with the financial entity and sufficient income so that they can quickly grant this benefit. But be very careful, because in these cases the interest rates are exorbitant. If you enter the overdraft, very high interest will be charged from the first moment of use. Credit card use should only be made if you are able to pay the bill after 30 days, otherwise you will also be charged stratospheric interest.
So what is the best solution to get out of the grip?
In fact, you have two possible and less traumatic options for re-stabilizing your home budget or even resolving an emergency: personal loan and payroll loan.
Below we will shed some light on these two options.
In this type of credit line banks usually charge higher interest rates than payroll loans, because there is always the danger of default. You must prove that you are able to repay this debt and keep in mind that the installments of this loan have a set date to be made and should not be late. They can be paid through checking account debit or even bank slip.
Institutions do a credit analysis and after approval quickly release the money that can be used where you find it most convenient, because it is not a normal financing where the ultimate goal is to buy some good. Usually the term payment is limited to up to 48 months.
This is a credit line with very specific rules that was created by law 10.820 / 2003 and is guaranteed by your retirement payment. From this year 2019 some rules have been changed and this type of loan can only be granted to withdraw for more than 6 months from the date of issue of this benefit. Payroll-deductible loans carry lower interest rates than personal loans: they are set by law at 2.08% per month, because the risk of default for banks is virtually nonexistent. Amounts due are deducted from your retirement even before you receive it.
What will determine how much you can get with this line of credit is the amount of your retirement and the repayment term will vary with your age. By law, the portion of your loan cannot exceed 30% of your social security benefit. The term for repayment of this loan is from 6 to 24 months, but may extend to 72 months (6 years), but this will always be according to your age, as there are limits set by law.
You are still entitled to a credit card with a 5% limit on your retirement.
Which means that by adding the loan plus the card, you will have 35% of your committed income. If you are negative or have some kind of restriction on the square, this does not really prevent you from making a payroll loan. In practice the situation does not change, because the guarantee of this credit is your retirement. Making a loan is no seven-headed animal, nor does it mean that you will be in debt forever. It can actually be of immense value as long as it is well used.
In the case of payroll loans this is even clearer due to the low interest rates practiced. It may be that you have a very high interest debt and with this type of loan it can be quite advantageous to settle this backlog and have a much lower monthly cost on your home budget. What is important is that if your only option at the moment is the loan, spend some of your time researching the interest rates and payment terms in banks and financial institutions. Even on the internet you will find a series of simulators that will give you all the information to make your decision the right one.