When you get into trouble with shortage of money you will be picking up various bad habits unknowingly. It may not look bad from your angle as you will not have any other choice. Immediate impact of high loan amounts or rent is that you will be having lesser amount on hand to spend for other expenses on monthly basis like essentials for house. One sure bad habit will pickup is the bad debt in credit cards. Forced to use the credit card for even small expenses without any cash on hand, you will not be able to repay entire amount on the due date instead you will be paying only the minimum amount you need to pay. Once it keeps increase, you will be maxed out and there is one more adverse effect.
How adverse the effect will be?
Since you are not able to pay back the entire due that has to be paid, your credit score will be affected immediately. Due to this, you won’t be able to get any credit card with higher limit instead you will be getting the card with lower limit only and also it will have higher interest which will be bad for the customer. Another problem will be you will not be able to save anything. You can save the money, if you take someone as roommate but again it will not help you to increase your credit score. At best, you can use that amount to save for future or any other emergency. Worst effect of this is you will not be able to spend on medical insurance or medicine when you are affected by bad health. Also, you will not be able to eat healthy nutritious food.
To avoid this kind of situations, you can read essential articles from useful site with inputs from leading finance managers and economists. It will be helpful for the people to follow their ideas. One good thing you can do is to choose the house with least monthly payment option which will enable you to save something. As per them, you should not spend more than one third of your salary for house. One has to keep this in mind when they are searching house for rent or to buy. This will help you to plan your budget much more effectively.