What is Best for you: Personal Loan Or Credit Cards?

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The question is! When is a credit card better than a personal loan and vice versa what does it do best for you?

If your purchases are in the thousands, it would be best to apply for a credit card that does not charge interest for the first 12 months. Anything below this can be repaid within a year and is done with a credit card.

Also, Read: Ways to Protect Your Credit Card and Money

If you have a small debt that costs less than a few thousand dollars and can be repaid within 18 months or less, an interest-free credit card is a safe bet. If you want to consolidate additional debt into a credit card balance, it is always a good idea to contact your credit card provider.

If the amount you want to spend is above your credit card limit and you cannot afford to pay it back within a year, a personal loan is a good option. If you want a loan of more than $5,000 and the repayment period is longer than 15 months, personal loans are a cheaper option, especially if they are better than credit cards.


Personal loans should be made when your purchases are at the top end, but if you borrow this amount and your amounts are large enough that the repayment periods are long (up to 15 months), then they may not be the best option for you.

Personal loans, however, have their downsides, with the largest being the 1.5 percent fee that can be applied for the loan. There is a one-off fee that you can pay when you make a payment, but not after the initial loan amount.
However, not all lenders levy this charge, so you should check and take account of this when comparing rates.

Some lenders offer much better APR ( Annual percentage rate ) and are more expensive in terms of the fees they charge, while others offer a higher APR or fee.

Hopefully, this has helped clear up some of the confusion, but credit cards and personal loans have long had their place in the credit card market. The path you want to take depends on what you need the money for, how quickly you can repay it, and how much you will need.

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