Today, many people switch jobs and careers, sometimes out of choice and sometimes out of necessity whilst many others prefer flexible working patterns to cope with the demands of looking after or starting a family. Others may choose to take a ‘sabbatical', i.e. to take some time out to maybe travel the world or to return to full or part time education in order to better themselves.

As this flexibility in our everyday lives becomes ever more the norm, then so many of us wish to have a similar degree of flexibility when it comes to our finances. We increasingly want loans and other financial agreements to work in our favour as opposed to being tied to and dictated to by the agreement itself and ‘payment holidays' built into the structure of a loan are becoming far more common with people being able to take a break from repayments either shortly before the loan is due to start or part way through the loan.

They can offer an ideal solution to those such as the self-employed whose income can fluctuate dramatically either suddenly or during a regular slow spell during the course of their work year or to those whose income is mostly determined by the commission they receive which can vary dramatically throughout the year. In essence, a loan which comes built in with a holiday payment break generally allows borrowers to repay what they borrow in a way that fits neatly into their lifestyles. Some types allow borrowers to repay more than the minimum amount when they want to and less when they need to. If they're getting ahead of themselves with repayments, then it avoids the problem of increased interest charges when they're looking to take their payment break.

However, because of the increased flexibility of these kinds of loans, the APR is traditionally higher than with a normal loan because of the added flexibility it offers so it's well worth doing the sums and working out whether a more flexible loan is financially worth it over the entire term of the loan. They are also more common when looking to borrow money over a shorter period.

It is, however, worth speaking to a financial adviser or independent finance broker firstly if you are considering taking a personal loan payment holiday plan.