Because of their flexible nature — you can use them for almost anything — personal loans can be super tempting to avail for every huge expense in your life, whether it’s strictly needed or not. All this freedom can get scary, though, especially considering how personal loans are just like any other form of debt, with interest payments and other fees. So you might ask: For what justifiable purpose should you take out a personal loan? Even the best ones have pros and cons, but the common thread is: Make sure what you’re spending on is a good investment. And always check fees and interests attached
Now, let’s get into the nitty-gritty of using your personal loan powers for good.
1. Paying for your/your child’s tuition fees
Education is a very important investment, and getting the best for yourself and your children is definitely a top priority. Unfortunately, the best can sometimes be heavy on the pocket, and despite the wealth of payment options available in most schools, shelling out huge amounts of money for school can get overwhelming. This is where personal loans can come in handy. The best loans would allow more flexibility and leeway through lower payments compared to what some schools offer. However, it would be a bad deal if you take out a loan that, when adding up fees and interest, would end up costing much more than the actual school fees.
2. Home shopping and renovation
With personal loans, you don’t have to endure an uncomfortable living space — or worse, risk injury or sickness — if your home is in need of some serious renovation, or even if you just want to change things up! Never underestimate the power of a well-designed house upon its dwellers’ well-being. If you intend on selling or renting out your house or condo in the future, then this justifies taking out a personal loan even more, as this will boost the property’s value on the market. So go ahead, turn your living room into a home entertainment area, complete with surround sound and a movie projector. If it’s time to replace your old, worn-out, electricity glutton of a refrigerator, don’t hesitate! It will save you money in the long run.
3. Debt consolidation and paying off credit card debt
4. Personal trips and vacations
This is one of the common reasons which banks propose as
Thanks to personal loans, a dream vacation or honeymoon can turn into reality. This way, your savings will be intact and you’ll be using your future disposable income to pay for the loan as you get the money just in time for your chosen trip schedule. However, the benefits that come with trips are usually short-term, so be sure the trip would be well worth it! Use a loan calculator so that you know how much the monthly payments on the best loan would be, and determine if the trip is indeed worth the extra monthly expense. Then again, if your trip turns out to be one for the books, the memories alone are priceless.
5. Emergency medical expenses
Out of all unforeseen short-term expenses, emergency medical expenses are perhaps the most devastating. Hospital fees and medicine costs are no
But remember to avoid using loans for emergency purposes, especially if you do not foresee a disposable income to pay for it in full.
6. Wedding expenses
Really, weddings need not be extravagant — don’t give in to the hype! But if you simply must have your dream wedding, complete with a designer ball gown, a four-course menu and a reception worthy of royalty, there’s nothing wrong with pursuing that. Consider taking out a personal loan so you don’t feel iffy withdrawing hundreds of thousands just for a single night. Like vacations, the payoff for this might seem extremely short-term, so make sure you’re willing to pay the cash loan off for months or years to come, long after the last slice of wedding cake has been devoured and the vestiges of your relatives’ and friends’ touching speeches have all but faded.
As an alternative, you can ask your guests to help you pay for your wedding reception instead. In Singapore, a box is placed at the reception area for guests who wish to help you pay the bill. It's time to be practical.
Personal loans are handy and powerful, but like any other debt, they are still responsibilities that are not to be trifled with. Evaluate your financial habits, ability to pay off loans and overall situation first before availing, and always take out the best loans with the most reasonable interest rates!
Confused as to where all the best personal loans are? Head on over to GoBear Philippines to compare rates and find the best fit for your budget.