Loans if you’re responsible can be really beneficial to your finances, however there are times when getting a loan is probably not the smartest thing you can do. Here are a couple examples of when getting a loan is a dumb thing to do
Probably the dumbest reason for people to take out is for Gambling. By risking it all on a football, cricket or rugby match you run the risk of not only losing your cash but being in debt for a long time! While playing in casino there might be a slight chance of a mega windfall, it’s best to avoid or run the risk of getting addicted. People generally take a loan out for Gambling when the losses continues which makes them think they need a loan. Once a person gets into it he starts getting addicted for it. It’s just a waste of money and time which also creates problem and hardship for families.
Buying a Sports car
Many families dream for having a luxury sports car but due to high prices they can’t afford to buy it. So they take loan for only fulfilling their dream but running into some serious debt! But taking loan to buy a luxury sports car when you can’t afford it is probably not a wise move. When you are thinking of buying a car make a careful budget and consider if you are able to pay off debts comfortably each month.
Investing in the next best thing in the stock market
Investing in stock market is another big risk, especially if the company hasn’t been trading for a while or hasn’t posted profits and the stock has hit rock bottom, taking a loan isn’t a wise decision. Stock Markets are very volatile at the best of times, especially in this current climate. Investing without complete knowledge of stock market should be avoided. The risks are simply too high.
Spending money of the most amazing (and expensive) Christmas ever
Christmas can be an amazing time of year, but can also be a very debt riddled time of year if you’re not careful with your finances. Very easily you can be sucked into buying the latest and greatest toys for the children, or obscure things like blow up snowmen, and various other lights (which might put a dent in your electricity bill as well). Loans are usually taken out avoid paying off a loan for Christmas in August. Ensure that you don’t spend beyond your means but that doesn’t mean you can’t have a great Christmas anyway! It’s just dumb to spend money on one day when you have the rest of the year to pay for as well.
What other dumb things can you think of that people have taken a loan out, I’d love to hear what you think!