Loans better than overtime?

System

Dave - a loan is just paying something from future wages, notably less taxed wages, tax usually exceeds interest

boo_star

MatthewAinsworth wrote: »

I'd say avoidance, and maximising time with little one but still being able to get married and pool money into a buy to let trust

Whatever you think it is, it won't work.

Pixie5740

MatthewAinsworth wrote: »

Dave - a loan is just paying something from future wages, notably less taxed wages, tax usually exceeds interest

Paying interest is stealing from your future self. In the future you will have less disposable income. This thread has to be a wind up!

andyfromotley

I assume this is a wind up? if not Matthew, then you are econimically illeterate. Please hand control of your finances to someone else, and quickly. Any small child you know should be a safer pair of hands. If you dont know any then perhaps the family dog?

ViolaLass

MatthewAinsworth wrote: »

Dave - a loan is just paying something from future wages, notably less taxed wages, tax usually exceeds interest

The government won't care that you've got a loan to pay - they will tax you the same amount regardless.

foxy-stoat

andyfromotley wrote: »

I assume this is a wind up? if not Matthew, then you are econimically illeterate. Please hand control of your keyboard to someone else, and quickly. Any small child you know should be a safer pair of hands. If you dont know any then perhaps the family dog?

Fixed that for you !

redpete

The OP seems to have ignored the fact that the money used to eventually pay off the loan will have come from his income and been taxed before he gets it - it is valid to count is as being taxed at the highest marginal rate and as affecting child tax credit.

Ebe_Scrooge

I think Dark Matter has been on the sauce, and logged on to the wrong forum section by mistake :rotfl:

Herzlos

If you're talking about in a very short space of time, with no concern about the long term consequences, and squint in just the right way, you're correct; loans are better than overtime.

But for the real world, you're always better off earning more instead of borrowing; if you take a loan out you're just paying more from the same wages later (and have to work to pay off the interest). If you do overtime (or sell unwanted stuff) you literally get more money, AND have no interest to pay off.

Depending on your situation, it may not make any sense to do overtime (and this is where I think you're getting confused). If you're on, say £10 an hour but lose £7.73 in tax / benefits reduction (which seems odd, but that was your example), then is it really worth working overtime for £2.23 an hour? You can probably make that by flogging a couple of DVD's on eBay.

Back when I was a student, I always felt that overtime was a waste of time, as it put me into the tax threshold and I lost 30% of it, but then I realised I got to spend the other 70% of it and realised that student me was an idiot.

JimmyTheWig

I think I know what the OP is saying.
Borrow £100.
Invest £100.
Investment turns £100 into £120.
Repay loan plus interest of £110.
Profit £10.

The OP is suggesting that that is a better way of making £10 than working.