There are right times to use credit to purchase something and there are also times when it is absolutely unwise to use it. Granted, using a loan than using cash is good for building credit, but using borrowed money for some purchases can be unwise. What are these top purchases?
Your dream vacation
A “dream come true” may sound like the best things that could happen to anyone but a dream made true by taking on a loan and pawning your future income might not be worth it. If you use a credit card to fund that vacation promising to pay it off in one fell swoop, but in reality you could not make the payments, then your memories are ruined.
You see, vacations are there to set you free from stress. But if a vacation will put you under stress because of a mounting debt, then something here is not right.
Don’t force or rush a dream vacation. After all, what makes it a “dream” is that it is not easily achieved. You have to work hard for it, and working hard for it could mean saving money for months until you get to the last cent of your supposed dream vacation budget.
Your dream wedding
Weddings are an expensive thing. For sure, a “dream” wedding is even an awful lot more expensive.
A wedding marks the start of your life together as husband and wife, but having a huge debt and a sky-high interest rate might be a terrible thing for a start.
You see, wedding is just the start of the even more expensive stuff that you’re going to spend for as couples. After wedding, there will be maternity, then kids, kids’ education, life insurance….possibly a new home or a new car. Then in a few years, you’ll start thinking about retirement.
Instead of taking out a huge loan for a dream wedding, why not just talk to your partner and start saving for it together? Come to think of it. It’s like having a shared goal together, even if you are not yet officially married. Plus, neither of you will feel rushed about it. Lastly, when you achieve your savings goal for your dream wedding, you both feel that you have accomplished something big as a couple…and walking down the aisle would even feel like another victory — a different one after marrying the woman or man of your dreams.
Milestones in life may call for celebrations but if you need to borrow for them to happen, then it would be better to relinquish that thought. Celebrations are not a matter of life and death, and you will not lose your friends or families just because you failed to throw a party, where you have to spend for booze (a lot of them!) and food for a lot of people. Moreover, if after a celebration you’re left with stress because of the debt you incurred, then the party, which ought to make you feel good, would mean nothing. Opt for a simple gathering with a select people instead. Even if it’s a small group, it is still a celebration.