It’s a strange old world. Since the big boom of the 1980s when it seemed that we could have anything we wanted if we worked hard for it, we’ve believed it. We go on believing it even though times are very different now. Market and financial stability are shakier. Who’d have thought we’d see European countries having to be bailed out of financial crises?
On a personal level it is much the same. Even though we are now being told we may have to become a nation of property renters again, everyone is still striving to own or hold onto their own home.
A couple of generations ago, people wouldn’t have considered taking out a loan for anything other than a house. Even that caught in the palettes of some as it seemed such an enormous amount of money to have to repay.
Since the 80s though we’ve been in an aspirational, easy-come, easy-go sort of mood. So no one expects to wait for things they need or even want. And the emphasis on need or want isn’t always accurate either. That’s why we thought you’d be interested to see this list of 10 reasons, five sensible and five not for taking out a loan:
- A loan to buy a car: one of the top reasons according to the compiler for a loan.
- To facilitate debt consolidation: another popular reason and one that could save you interest on credit cards. Compare interest rates carefully though.
- The dream wedding: without doubt weddings are expensive and a loan can mean yours or your daughter’s can be that extra bit special. Just remember it is only one day in the scale of things.
- Improving your home: come on this is an investment and worth paying for.
- An extension to your home: cheaper than the cost of moving usually and again a good investment not to mention the luxury of more space.
Less Sensible Reasons
- Top of the list is cosmetic surgery: whatever you views on these procedures if it isn’t for medical reasons, you should save up for it!
- A definite no-no: Gambling is a loser’s game so borrowing money to fund it or pay off debts just gets you further into the hole. The simple sum is that no one can afford to gamble with borrowed money. You know it makes sense.
- Stock market investing: risky. Stocks go down as well as up and with borrowed money you’re paying interest … the cost of the money is preclusive to the end result.
- To play Santa Claus: You’ll pay for it all year or longer. Get back to the roots of Christmas and the budget you have. Don’t bow to the pressure. Remember there’ll be another one next year.
- Helping a friend: very altruistic but it makes no sense when you have to pay interest. Besides which it could easily destroy your friendship when the friend can’t repay.
If you have a good reason to take out a loan and can afford to repay it, then engage the financial services of a reputable company like Loans Direct or Norton Finance.
By Rob Rudd
Rob Rudd frequently writes for business and finance websites. When not writing he enjoys browsing property websites and dreaming of the next move.