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Do’s and Don’ts When It Comes To Borrowing Money

It seems to be inevitable nowadays for people to not borrow money in any type of way. Debts can both help and ruin people’s lives, especially if it gets out of hand. However, come to think of it, debts are actually not the problem, it is the people. Simply because people chooses to borrow money, it’s not like debt itself pushes itself to people. If you know what you’re doing then, you’ll totally be fine, but if not, it can be pretty scary. So here are some Do’s and Don’ts when it comes to borrowing money.

“Small miseries, like small debts, hit us in so many places, and meet us at so many turns and corners, that what they want in weight, they make up in number, and render it less hazardous to stand the fire of one cannon ball, than a volley composed of such shower of bullets.” Rudyard Kipling

DO’S

• Have the right reasons

This has got to be the most important thing to considered when it comes to borrowing money. People make huge mistakes when it comes to this so make this as a priority out of everything. It is a total must to think thoroughly about why you’re considering borrowing money, if it is for emergency purposes then of course it is totally fine, but if it is for unnecessary things like going shopping cause there is a sale, going on a vacation just because you see everyone having one. Be a reasonable and responsible adult and don’t borrow money just because you want to.

• Find the best interest rates


Another great way to be wise when it comes to borrowing money is to choose those who have lower interest rates, like in credit cards and loans. Look for the one that would totally suit you and not basically rob you because of high interests.

• Save while paying off the debt

Basically, when you are paying off debts, you are most likely just spending and paying, which would then mean that you are literally getting nothing from your salary. Always make sure that you save some money, no matter how much it is, just have something left for yourself.

• Keep track

Finally, you must always keep track of your debts. Know when you need to pay for them, know how much is left to pay, know when you did it, you must keep track on everything. List everything down in your planner or phone, so that you wouldn’t forget, especially when it comes to when you should pay for them.

DON’TS

• Have multiple debts

It is definitely not ideal to have multiple debts since it would be like you’re trying to earn money just to pay it all off. There are so many kinds of debts like auto loans, mortgage, student loans, even credit cards. If you have every single one of those, it is like most of your money is going there.

• Live off of debt


Another thing you may not let happen to yourself is to live off of debt. It is certainly impossible for you to have an ideal life if you have debts all the time. Living off of debt is basically borrowing money for you to survive, and to pay it off, you would borrow money again. It is a never ending cycle that you should never do.

• Borrow money you can’t pay

Now this is just plain common sense, borrowing technically means that you are taking something from someone else with there permission and you are obligated to give it back. With money, you must have the ability to pay them back since you had the courage to borrow. It wouldn’t be there problem on how or where you will get the money, just as long as you give it back, with interest depending on the deal.

“Further education should be about the ability to learn, not the ability to pay. Everyone who is able should have the opportunity, regardless of their family background. I don’t want to see students struggling with huge debts or frightened off even going to university in the first place.” Charles Kennedy

It is best to use this as a guide when it comes to borrowing money. It is for your own convenience since this would totally help you out when it comes to deciding on borrowing money,

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