IT has seldom been cheaper to spend money you don't have by getting a loan from the bank or credit union.

Even though interest rates in general are on the way up, AIB is moving in the opposite direction by cutting the cost of personal loans to between 6.99%10.33% depending on the amount borrowed.

For loans over 25,000, AIB's rate of 6.99% is the lowest on the market although, with borrowings this big, you should consider topping up your mortgages instead. This means putting your home on the line if you run in financial difficulties but, with home loan rates hovering around 4%, it is nevertheless a tempting option.

AIB's rates are variable so there are no penalties for paying off the loan early, although borrowers are leaving themselves open to the interest rate hikes that everyone expects in the coming weeks.

Expect to pay more for the peace of mind of a fixed rate of interest, which will not change as rates rise.

National Irish Bank has a fixed rate of 7.5%, giving monthly payments of 269.10 on 13,500 borrowed over five years.

The same loan from AIB would also cost 7.5% although, because the rate is variable, is is likely to increase in the coming months.

Other lenders with low fixed rates include Tesco at 7.9% and Bank of Scotland (Ireland), which charges 8.2% fixed on loans of 2,500- 25,000

SAVE

PAYE workers are being ripped off when they retire because they have far fewer pension options than the selfemployed, according to a leading pensions expert.

Many PAYE workers must use their pension nest eggs to buy retirement annuities which provide a paltry income in retirement that dies as soon as they do. But the selfemployed, and workers with personal retirement savings accounts or PRSAs, can keep control of their pension nest eggs, taking out what they need to meet their living costs in retirement and passing on anything left over to their families when they die.

Joe Byrne, chairman of the Irish Association of Pension Funds, said few workers realise the extent to which the system is stacked against them because so few