What's that you say?  No collateral, no down payment, no problem?  Mas here is come! Well if it seems too good to be true, it usually is…. Carnival loans are not a new thing.  I’ve heard of people taking out loans to pay for any number of carnival related expenses, from fete tickets to flights and everything in between.  Take this advertisement from Island Finance Trinidad and Tobago and another from Eastern Credit Union: trinidad-carnival-2014-ECU-loantrinidad-carnival-2014-loan For some, offers like this are very seductive.  “I couldn’t afford to pay for mas but now I can with this simple and easy carnival loan”. So the question is:  how much do you actually pay if you take a loan to pay for your costume? Let’s do some quick math using an actual costume: Trinidad-carnival-2014-costume-tribe-warchant
Lisa just HAS to play mas for Trinidad Carnival 2014.  Dat costume was MADE for her. However, Lisa has no savings and she has already maxed out her credit cards.  Lisa sees an advertisement on TV promising “no collateral, no downpayment.  Same day loans”.  She goes into the local lending office office and signs on the dotted line. Costume: Tribe- War Chant female frontline with upgrade to bonnet trail headpiece (because she's worth it) - $8745 Amount borrowed to pay for Tribe Costume - $8745 Time to pay off – 5 years Interest rate – 24% Monthly payment - $251.58 Total interest paid: $6349.80

Original Costume price - $8745

Total cost of costume over 5 years: $15,094.80

tracey-morgan-nope
  Poor Lisa!  Instead of paying $8745 for her carnival costume she ended up paying $15,094.80.  That’s a whopping $6349.80 more than the actual cost of the costume in the first place. To put that into perspective: Lisa's interest payment of $6349.80 is more than the cost of YUMA's Kooza frontline costume ($6295).
Using the same money that she paid in interest, Maria could have paid for this costume and still had money left over.

Using the same money that she paid in interest, Lisa could have paid for this costume and still had money left over.

  Come now people, Carnival comes every year.  If you cannot afford it this year, make a plan and start saving so next year you can play yuh mas. And for heaven’s sake:  Please do not lose your mind and take out a loan to pay for your Carnival expenses

 

Feel free to leave a comment and let us know if you have taken loans to pay for carnival.