Bad Reasons to Get a Personal Loan
You may consider a personal loan if you are in need of some extra cash for large purchases. Personal loans are generally unsecured so you do not have to put up any collateral. Unsecured personal loans then carry a higher interest rate so should be used when necessary. Here are 3 bad reasons to get a personal loan.
Pay for Your Wedding
So you are starting to plan your wedding, but don’t let this happy time turn into a fight about how to pay off the massive debt that you ended up with for just one day.
Instead of getting a personal loan to pay for your wedding you should save up and not surpass what you are able to afford. If you do not have the budget for your wedding then you need to think about postponing or to downsize your wedding.
Pay for a Vacation
You go on holiday to relax and have fun, but when you come home you don’t want to face debt for going on holiday. If you are planning a holiday then you should save up to pay for your trip in full and not end up in the red.
Finance a Car
If you need a vehicle and don’t have the cash then it is a good idea to take a car loan. Personal loans will usually have a higher interest rate than a car specific loan.
If you financing a car speak to your credit union about car loans and their rates, then go to the dealership and compare that financing option with the other and choose the more affordable one.
The rule with debt is that you should only go into debt when it is necessary and forego personal loans unless it is an emergency. There is no reason to saddle yourself with debt in order to pay for a wedding, a vacation or a car.