Unexpected additional costs during tough times by Barclays

Despite our best intentions and careful budgeting, sometimes an unexpected expense rears its ugly head for which you simply don't have enough savings in reserve.

The simple truth of the matter is that life does go on - even in a recession. The credit crunch won't stop your kids outgrowing their bikes or school uniforms or prevent your car or fridge freezer breaking down. Computers and TVs do fail and teeth can fall out - an emergency dental bill can be costly.

With every penny now having to be accounted for, in these economic times it's not surprising that few of us have much left over for that proverbial rainy day. But if the roof is leaking or you've decided that some holiday sunshine would be the best possible investment for your working motivation, there is a solution.

Personal loans

Rather than an act of folly, getting a personal loan to provide a fund for life's little surprises can, depending on your current level of debt and personal circumstances, offer a smart way to manage your finances – even when times are hard.

If you need to replace your car or make essential home improvements, a personal loan can provide a sensible means to comfortably cover and manage this expenditure. Barclays is one lender still offering loans to their existing customers with a good credit history.

It's not just costly surprises of the unfortunate kind that can come our way. Happy eventualities such as a wedding, the arrival of a new baby, or simply a much needed holiday can demand more from our finances. Getting a personal loan to pay for 'big ticket' items such as a wedding reception can ensure you get everyone to the church on time, and help you manage your costs.

Essential advice

As long as you're entirely confident of your ability to make the monthly repayments, personal loans can offer an invaluable helping hand.

• Set a budget and don't be tempted to overstretch yourself.
• Borrow the minimum amount you need - the more you borrow the larger your total interest bill will be.
• Make sure you choose the right loan for you. A loan offering a fixed interest rate means that you'll know exactly how much you'll have to re-pay without the risk of rising interest rates.
• When choosing a personal loan, check the TAR: Total Amount Repayable, and not just the APR (annual percentage rate). This will tell you the entire cost for your credit over the term you select, which is not always apparent from the APR alone.
• Keep the term of your loan as short as possible but make sure you can still comfortably afford the monthly repayments.

Borrowers looking to get access to cash to cover emergencies or to plan for those big purchases may find that personal loans offer a convenient and cost effective option.

If you are a Barclays Current Account holder and you’d like to find out more about a personal loan from Barclays, please visit www.barclays.co.uk/loans

The information given in this article was correct as at 20/03/10. It does not, however, take account of any changes in regulations, the law or interest rates since that time.

This article is not a substitute for obtaining professional advice from a qualified person or firm.

Examples given of products and services are not exclusive. Other companies may provide the same products and services, and inclusion of a product or service should not be taken to indicate that Barclays recommends it over any similar product or service.

Barclays Bank PLC is not liable for any third party opinions expressed. While every effort has been made to ensure that the information contained is accurate at the time of publication, no liability for damages is accepted by Barclays, the publishers or any other organisation or person providing information, arising from any errors or omissions that may appear, however caused - or from any editorial alterations to submitted information. This is not intended and will not affect any liability of Barclays under the provisions of the Financial Services and Markets Act (2000.)

Barclays is a major global financial services provider engaged in retail banking ( current accounts and savings accounts), credit cards, corporate banking, investment banking, wealth management and investment management services, with an extensive international presence in Europe, the Americas, Africa and Asia. With over 300 years of history and expertise in banking, Barclays operates in over 50 countries and employs over 140,000 people. Barclays moves, invests and protects money and provides personal loans, home insurance, life insurance and other services for over 49 million customers and clients worldwide. For further information about Barclays, please visit our website www.barclays.co.uk.