subject: Is It Ever Ok To Take On Debts [print this page] Frugal seems to be in fashion these days. After all of the economic problems of the last couple of years, many people have learned to pinch pennies. After all, credit card interest rates have increased, savings interest rates have declined, and lots of costs have gone up. Add an unstable job market and declining home values, and you can understand why it is smart to be frugal.
It can be hard to tame the credit habit. But most of us are really working hard to be very careful about using plastic, or even taking our any sort of loan.
But none of this means that we should never use credit. There are still some things we will want, or need, to go into debt over. Consider some examples of cases where it may be a good idea to flash plastic or take out a loan.
We have all had those weeks when multiple things just seemed to go wrong. That flat tire and your glasses both needed to be replaced, and this just could not wait. Some things need to happen if you have money in your checking account or not.
Also look at financing long term purchases. We all have to live somewhere, so we probably always have to choose between a mortgage and rent. Most experts agree that an affordable mortgage to buy a home to live i is an acceptable use of credit.
Shoud you go into debt to buy a car? Most people do this, but it would be prudent to only get basic transportation without going overboard. A vehicle depreciates the minute you drive it off the lot, and millions of peope get upside down on their auto loans. Try to minimize your vehicle debt if you can.
Education is another source of debt these days. We all want to make more money and improve our lives. But we have also seen how many graduates are buried in college loans these days. Again, you can probably justify education loans, but try to do what you can to minimize it.
There are some really bad credit choices. Is it ever an emergency to eat out at a fancy restuarant or buy designer shoes. I think the emergency situations like that are pretty rare.
by: Cathy Carlson
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