Licensed Money Lender Personal Loan Sembawang

When you borrow money, it’s important to know the difference between good debt and bad. 

Good debt is a personal loan that helps buy necessities for your family. Whereas with bad loans, you cannot afford them, or they are used on things not needed, such as when people use credit cards as short-term financing options instead of paying cash upfront.

It’s advisable to take a good debt, but how do you know if it’s the right one? Here are some examples of what might be considered good and bad debts and why they’re worth considering for your finances. 

Considered Good Debts 

1. Education loans

It costs a lot of money to get an education, but it can pay off over time. If you invest in yourself and go for your dreams, then the benefits will outweigh any expenses that come up. 

It takes hard work and dedication, but investing in oneself pays off.

2. Business loans

When borrowing money for a business, it’s good debt if the cost of borrowing is less than what you earn in return. 

3. Loan for property investments

They say a house is the biggest investment most people ever make. And it’s true; houses do fall in value sometimes-just like stocks and bonds-but if you’re careful about investing wisely, your debt will end up being considered “good” debt because at least that money was invested for something tangible. 

Considered Bad Debt

Credit Card

One of the most common errors people make is racking up credit card debt to buy their “wants.  Don’t give in to your temptation to buy luxuries you know have a low chance of generating any positive return. For example, there’s no chance you will be able to resell an overly expensive device at a profit.

Here’s the thing: life is full of setbacks. You have to be prepared for anything, and that includes bad debt! The key is knowing when it’s necessary — like needing a loan to get medical help or defending yourself against someone who sues you.

Final Word

If you are in a situation where the only option is to acquire bad debt, try not to rely on your credit card for help. They have high-interest rates and cash advance fees that will make it difficult for you eventually pay back what’s owed.

Instead of going through all this trouble, contact the best licensed money lender near Sembawang, who offers personal loans at lower interest rates (from 1-4% only) and manageable repayment plans, so there won’t be any issues getting out of debt as soon as possible.

Check out Sembawang Money Lender today to get your personal loans!