Various options available for funds

By Myra Bean

The holiday season makes financial demands on families that can’t be ignored as easily as other times of the year.

Traditional bank loans are often the best financial options, but there are other ways people get extra pocket cash to aid in stretching regular paychecks during the holidays.

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Aside from the banks, there are loan and finance companies and payday loan options.

A popular option for avoiding money problems during the holidays is taking advantage of Christmas Club accounts at banks at credit unions.

First Security Bank’s Calvin Flint has been in the business of making loans for 42 years. He said the banks see borrowers just for Christmas, but most people use the traditional institutions for larger purchases.

“We do see an increase in folks coming in (for Christmas money) but but it’s not like a big increase. We’ll see a very modest increase, but it’s not an all day, everyday thing,” Flint said.

He attributes the decrease in specific Christmas loans to an improved economy, unemployment decreases and not as many taxes withheld from employment checks.

“Maybe in general people have a little more money to spend and that may be why we are not seeing as much people coming to borrow,” Flint theorized.

Flint said he tries to advise people if they borrow for Christmas to only borrow enough to pay off in one year. “What you don’t want to do is run those loans out more than a year. Another year you will be borrowing for Christmas and you don’t need to be paying for last year while you are going to borrow this year,” he said.

Flint said a better solution would be to open up a Christmas Club account.

“With a Christmas Club you can take the money you would be paying on a loan in January or February, and at the end of the year around Thanksgiving we would send out a check to you. Instead of you borrowing from us, you are borrowing from yourself. That’s a much smarter way to do it,” he said. “You don’t pay interest on it. In fact we pay interest on the account. It is separate from your checking and savings.”

Of course it takes self-discipline to put that money aside, he said, and the number of customers taking advantage of the Christmas savings plans seems to be decreasing in recent years.

And there are several smaller finance companies in Batesville and Panola County which provide loans, usually in small dollar amounts.

Maribeth White, owner of Batesville Finance,  said she does see an increase in loans during the Christmas season, but notices that her customers come in all during the year. Her office on Hwy. 6E offers loans up to $3,000.

The last option for many consumers are the state-regulated payday loan businesses which allows people to write checks for cash and repay the money with a future paycheck. Payday lenders typically have the highest interest rates allowed for their loans.