Many workers will find that when they are off work sick, they will get sick pay equivalent to what they get paid and from the first day they are ill. However, not all employers provide this and so they may be able to get statutory sick pay but this will not start immediately. There will also be those that are not even eligible for that. This covers anyone that is self-employed, a freelancer, contractor, temping or on what is commonly known as a zero-hours contract or part of the ‘gig economy’. This means that there are many people that will not be able to get sick pay and they may be looking for alternative ways to manage their finances when they are unwell. This might include things like getting a loan. It is worth thinking about this very carefully. You will need to consider a few things before deciding whether to take the loan and which one will be best for you.
How long will I be ill?
It is a good idea to think about how long you expect to be missing work. This is because once you take out a bad credit loan you will need to repay it. This could be pretty quickly and so you need to be sure that you will be better and able to repay. If you have a sickness bug, cold or flu then it is likely that it will not last long. However, sometimes these things can lead to more serious conditions such as dehydration or pneumonia and you could miss a lot more time off work. It is a good idea to think about the chances of this happening due to your age and current health. Also consider how you normally are when you get this sort of illness and whether you can normally shake it off pretty quickly.
How much can I afford to repay?
It is wise to also think about how much you will be able to afford to repay. With a payday loan, you will have to repay all of the money that you borrow when you next get paid. This means that you will need to be sure that you will have enough there to cover it. If you have been unwell and not earning and not getting sick pay or getting a reduced pay, then you could find that there will not be enough there to be able to afford to repay the loan. It is also worth noting that you will not only need to repay this loan but you will need to cover the costs of everything else you normally buy as well such as food, utilities, rent and things like that. So be sure to check this to make sure that you are confident that you will manage it all before you agree to the loan.
Does the loan offer good value for money?
It is also well worth checking to make sure that the loan will offer you good value for money. Consider what you are getting from the loan and how much the loan costs and whether you think that this will be worth it. If you think it is a bit expensive then do check other lenders as costs can vary as they can between different loan types. You need to think about whether you feel that it is a good idea to pay out this much money for a loan compared to what else you might spend that extra money on.
Will I get a loan?
It is also worth considering whether you will get a loan. While payday lenders do lend to those people who have poor credit ratings they still will want to check that you will be getting an income. This is because they will want to set up a direct debit for the money to be paid off on the day that you are paid and if you are not going to be paid then there will be no money to repay the loan with. It can be worth checking with a few lenders first, to see whether they will be okay with lending you money.
There is a lot to think about. It can be scary thinking about being ill and what you will do for money. It can be really wise to be very careful with your money and build up some savings and so if you are unwell, you will be able to use that rather than having to borrow anything. Some people also get some insurance which will pay for their mortgage or other loans so that they can be paid if they are not able to. You do have to be careful with this insurance though as it is expensive and will sometimes only pay out in very precise circumstances.