Personal finance for beginners

Compound interest picture.

Compound Interest is just one of the ‘scary phrases’ people come across in personal finance.

Here at Mr Lender, personal finance is what we do, and whilst our main aim is to offer short term loans, this blog is also here to help give you advice in all areas of personal finance.

We thought we should start at the beginning, so here are some basic definitions about personal finance we think might help you:

  • Interest – Interest is the fee paid by the borrower to the owner as a form of compensation for the use of an asset. More than likely, this asset, will take the form of a loan or credit card.
  • BACS – BACS is a form of electronic payment for processing a financial transactions. These will take three whole working days to clear.

Day 1: Payment is entered onto the system.
Day 2: Payment is processed.
Day 3: Payment is cleared.

  • Capital – These are the funds (the original loan amount) provided by lenders to another party (person or businesses).
  • eAPR – effective APR is the fee+compound interest rate (calculated across a year).
  • Compound interest – When compound interest is placed on your original loan amount, from that moment on, the interest that has been added also earns interest.
stress finance diagram

Don’t let your personal finances stress you out.

Pay attention to our regular series of budgeting blogs too, as they will be able to help ease the stresses that are placed on us all by our finances.

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