Two credits with the same interest rate can have very different costs if they include commissions, insurance, and other fees. Evaluate the total cost to be paid, check how much you will end up paying at the end of the term. This is where the credit becomes expensive. There is no room for improvisation here. If you don't define how much you need, how much you can pay, and what you are going to use it for, the debt stops being a solution and becomes a problem. "Unlike other credits, this one can be used to cover an emergency, pay for medical expenses, or any other purpose for which capital is needed," the source said. However, he pointed out, before making a decision, there is a key point you must be clear about: the credit is not extra money, it is an obligation that you will have to pay sooner or later. 10 basic tips for hiring a credit. Therefore, beyond focusing on the monthly payment, the director of Financial Education at Banamex shares the following advice for choosing a credit without putting your finances at risk and avoiding the damage of financial stress: Compare the Total Annual Cost (CAT) and not just the interest rate, this indicator reflects the total cost of the credit. If you don't review costs, conditions, and amounts, you end up paying more and fall into it without realizing it. The director of Financial Education at Banamex, Juan Luis Ordaz, warned that focusing only on the monthly payment is a mistake. The real blow is in the CAT (Total Annual Cost), in the term, and in everything you don't see at first glance. Avoid acquiring a credit impulsively, especially if you don't need it for something specific. Points to consider. The Financial Education Department of Banamex highlighted that in Mexico there are several credit options, and one of the most common is the payroll loan. This loan is usually easier to manage and in many cases, cheaper, but it also has its conditions: you need a formal job and for your payroll to be linked to the institution that offers it. Before deciding, it is worth thinking about how stable your employment situation is and reading the conditions carefully. In the end, a credit can be a great ally or a headache if you don't use it well. Sometimes a 'comfortable' monthly payment implies paying much more money. Analyze the term, choose a term that balances payments and a reasonable total cost. And suddenly, what seemed like a good idea can become a source of financial stress. "The reality is that a personal credit can be a great tool if you know how to use it. Avoid extending it just to 'breathe' in the short term. Review conditions and penalties, verify if there are charges for early payments, late payments, or restructurings. Consider several options, from Fintechs, banks, and other financial institutions, being aware of all options and their conditions gives you more decision-making power. Request only what you need, it is common that you have a pre-approved credit line higher than what you really need, analyze the amount you are going to request very well, exceeding this can lead you to incur other unplanned expenses. Calculate your maximum debt level, a common reference is that your total debt payments do not exceed 30% of your available income, although this percentage may vary depending on your financial situation. Do not use a personal credit for recurring expenses, such as food or services; it should be for specific needs. Distrust credits 'without checking history' or with unclear promises: they are usually more expensive. Have a clear payment plan before contracting, not after. It all depends on how you choose it. The difference is in how you choose it and how you manage it. "And most importantly: financial education is not about never getting into debt, but about doing it with information and with intention. Reviewing before signing is not an option: it is the only way not to pay more or even double. Credits without financial stress. Juan Luis Ordaz explained that applying for a personal credit sounds easy... until you start seeing rates, terms, interests, and fine print that no one explained to you before. Every decision you make today impacts your peace of mind tomorrow", he concluded. Be careful! A credit can get you out of a tight spot or get you into a worse one.
