Become someone who decides with numbers — not in a hurry
In 5 min you'll know: how to compare at least 3 alternatives by total (annual percentage rate of charge — total credit cost) before committing to any financial decision
In Block 2, Lesson 4 you learnt to compare mortgages using the and the FINE. In Lesson 5 of the same block you calculated the real cost of financing a car. Now you are going to bring it all together and make a real financial decision using concrete tools. The rule: never take on a financial commitment without comparing at least 3 alternatives by total TAEG — including all hidden charges.
Before you continue: when comparing mortgages, you used the TAEG as your criterion — how does that logic apply to any financed purchase?
(Answer in the next paragraph.)
Let us walk through a practical example. You have €10,000 saved and want to buy a €15,000 car. The dealership offers you financing "from €199/month". Before saying yes, you get three quotes: the dealership loan, a direct bank loan and a lease. For each one, you request the FINE and look at the TAEG — not the monthly payment. The dealership may have a "low payment" but a TAEG of 11%, while the bank offers a TAEG of 6.5% with a €230 monthly payment. After 5 years, the difference is €1,200 in interest that stays in your pocket. This is exactly what you practised in B2-L04 and B2-L05 — now with your real money.
The financial decision is not just about comparing numbers — it is about defining the objective first. Do you want to minimise the monthly payment? Minimise the total cost (TAEG)? Have the flexibility to repay early? Each objective leads to a different choice. If the goal is minimum total cost, the lowest TAEG wins. If it is the lowest payment, it might be the lease — but the total cost is probably higher. The final simulator in this lesson helps you put your real numbers side by side and see, in seconds, which option offers the lowest TAEG for your situation.
Rush is the enemy of good financial decisions. The salesperson says "this offer ends today". The bank says "approval is quick". None of these pressures change the numbers. The TAEG does not change because they rush you. The MTIC does not change because the application window is short. If you do not have time to compare 3 quotes, you do not have time to take on the commitment. Wait. Compare. Then decide. The method you used in B2-L04 for mortgages applies to any loan — car, personal, credit card. The tool is the same: TAEG, FINE, MTIC, three quotes, informed decision.
Notice: Mowei is a financial education and comparison platform. We are not financial advisors authorised by the Banco de Portugal. This lesson is general information, not personalised advice. For decisions about specific products, consult a financial intermediary registered at www.bportugal.pt.
Compare 3 real alternatives by total APR (3 min) →
Your promise: This month, before any financed purchase, I will compare 3 alternatives by total APR and only then decide.