Illustration of unhappy man shaking piggypank


Simply put, it’s best never to borrow. Set up a savings account (or even just a jam jar) and stick a bit of money in it all the time, so that when you need money in a hurry you can get some.

But life is often not that easy. If you need to borrow some money these are your options:

1. Friends and family. There are several advantages to this route and a couple of big issues.

The advantages are that your loan may well be interest free, the repayment terms will be easier and no third party has to get involved in your money affairs.

The big drawbacks are that firstly you have to come clean to your friends and family that you’re in trouble and need the help. Secondly, if you can’t pay back the money you’re hurting people you care about.

So our advice is to only ever borrow from friends and family if a) you’re sure you can pay it back, and b) they’re sure that they can manage without the money if anything goes wrong.

2. Social Fund. Before going for commercial debt, it’s worth seeing if there are any loans available from the Government’s social fund available to you. Budgeting loans are only for those receiving benefits.

3. Credit Unions. Credit Unions will offer you some of the cheapest and easiest loans you can get. The drawback is that often you’ll need to have been saving with them for a while before you can get a loan. Visit our credit unions page for more info.

4. Banks and Building Societies. To borrow from this lot you’ll need a good credit rating, and often some security to offer them as well. You can get good deals here, and it may make more sense to borrow a larger amount from a bank or building society, with repayments you can afford, rather than to have little loans all over the place you can’t keep track of. Have a look at for a list of loans available.

5. Payday loans. Payday loans charge you huge interest. Only ever consider one if you are sure you can pay it back at the end of the month. One in three people who borrow money from a payday loans company ends up getting into further money trouble. See our payday loans page.

6. Unlicensed lenders. Or loan sharks, as they’re also known. Don’t do this. It never works out well. See our loansharks page for more details.