Characteristics and conditions of the non-interest bearing loan between relatives and family members.

We often hear talk of a non-interest bearing loan between private individuals, spouses and relatives, which is called this (non-interest bearing) because it does not involve debt increase interest (see also Social lending). It is, therefore, a loan that is made by very close family members or acquaintances (for example partners in companies Srl). But what do you need to know in order not to incur violations of the law and carry out this non-interest bearing loan without having to worry about the Inland Revenue? Here’s what to do.

Occasional delivery and always in writing

Occasional delivery and always in writing

In order not to incur violations of the laws on the matter (especially money laundering and loan sharking), the first thing to know is that a non-interest bearing loan between private individuals or family members must have a purely occasional and sporadic character, since all the movements made on the current account are always traces and constant movements of large sums of money could give rise to investigations (see also bills of exchange between private individuals).

Another thing to know is that these types of loans must always be in writing, with a regular contract or with the so-called “letter for non-interest bearing loan”, that is, a private writing. In fact, these documents allow the Inland Revenue to verify that certain sums received do not derive from illegal acts but precisely from a loan made by a family member. In addition, they also help to move the debt collection actions in case it should not be returned.

What information to include in a contract or private writing

What information to include in a contract or private writing

In a non-interest bearing loan between private individuals or relatives, a written contract or a private writing allow to protect both who must receive the money and who is providing it, since inside it is necessary to indicate different information.

First of all, the personal data of whoever grants and who receives the loan must be reported (therefore name and surname, tax code, date of birth). Secondly, the deadlines to be respected for the refund of the sum, the reason and any penalties to be applied if the sum is not returned on time, must be indicated. It is then necessary to sign every single page of the contract from both parties (who lends and who receives the sum) and a signature at the bottom of the document. Finally, it should not be forgotten that this type of contract is always to be drawn up in duplicate, and it is also important to have the pages dated in an unimaginable way, preferably from a post office.

Extra money from the 13th salary: investing or paying off debts?

The end of the year is approaching and, with that, the time to review and renew the plans for the following year. Parties, trips and all the extra expenses typical of that time come with the 13th salary. This, in fact, is paid in two installments: the first in late November and the second in December.

But the use of that money divides opinions. There are those who prefer to use it to get out of the red, advance the bills, increase savings or buy gifts, and there are also those who do not give up investing it in a trip and family parties.

To help you make the best choice and make the most of your money, in this post we will show you how to use the 13th salary in the best way.

 

When to pay off debts?

When to pay off debts?

According to Gino Duran, a professor at the Brazilian Institute of Capital Markets (IBMEC), the most suitable option among all options is to eliminate debts, especially those with the highest interest rates that increase over time. This is the case with overdrafts and credit cards.

Debt settlement should be a priority, but it should never compromise the family budget. It is no use paying your credit card and ending up needing overdraft money to pay next year’s tuition fees, for example. Take advantage of this time to re-educate yourself financially by learning to select what your priorities should be.

Paying off your debts with the 13th is a good decision when the rest of the basic expenses of day to day are already under control. Otherwise, opt for a renegotiation with creditors, installment payments or even to exchange high interest rates for lower interest rates ?? and loans offered by the Just credit platform.

If you analyzed your financial situation and realized that, in fact, it is necessary to use the 13th to pay your debts, check out some tips to do this in the best possible way:

 

Start with the main debt

debt loan

Depending on the amount of money you have in hand, you may need to select which debts to settle. The choice must be objective: those that are generating more interest are a priority!

Overdraft and credit card are champions in this category. So, if you owe any of them, that’s where you should start.

In addition to the debts that multiply, another option that deserves your attention are those accounts in which you get some discount by paying them in advance, such as IPTU and IPVA. In both options, the single installments are smaller and you can also stay practically all year round without worrying about them.

 

Negotiate before paying

Negotiate debt

Cash payment is always a powerful advantage in trading. Take advantage of your 13th to ask creditors for special discounts and thereby eliminate as many debts as possible. If you have already paid in installments for any of them, it is also worth advancing installments to relieve next year’s budget.

Always remember that installment accounts are also debts. After eliminating interest-bearing ones, you can advance the payment of those that are up to date. Everything to start the new year with a more organized financial life! – Eliminate delays

Most companies change their due dates from one year to the next and generate a larger invoice in the first month of the change to make up for the extra days left behind. This makes it very difficult for those on a tight budget, who usually leave the payment until later. With the 13th salary you can finally take that break and stop paying interest for late payments.

 

When can debts wait?

According to financial educator Raymondo Donnas, receiving the 13th and going straight to the bank to pay off debts can be a mistake if you are still unaware of your financial situation.

Before making the payment, calmly analyze the accounts and check for any defaults ?? interest running on overdue accounts. If that is the situation, then pay.

If all of your accounts are within budget and you are not paying interest, assess whether you have any other important goals that can bring you a good return. Good options for investing this money are those that allow you to improve your monthly income, such as a professional course or a small business.

If the person has no debts, the 13th can be used to create an emergency reserve. As we do not have this money on a daily basis, you do not need it to maintain yourself. As soon as you receive the 13th, send it directly to a savings or investment account, so you don’t run the risk of spending it unnecessarily.

Were you able to decide where your thirteenth’s money goes? With all these tips, you can take the next step towards achieving your goals.