A Personal Loan Can Help You Meet Your Financial Goals

by Team Dinks on April 6, 2013 · 0 comments

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(Guest post written by T. Williams)

When you are attempting to make a financial change in your life, obtaining a personal loan can help you meet the financial goals that you have set for yourself. A personal loan can be used for any financial need that the borrower has and can be arranged with generous repayment terms to reduce your risk of defaulting on the loan. Many people use these loans to purchase a vehicle, make improvements to their home, or pay for their children’s education. Here are some good reasons to seek out the best personal loan for your needs.

Better Interest Rates

Personal loans often have much better interest rates than other types of financial products. For example, personal loans carry an interest rate of around 5%, while a car loan from a dealership can be as high as 9% and the interest rate for a credit card can be around 20%. Being able to obtain financing at a lower interest rate will save you hundreds in interest charges over the life of the loan.

Build Your Credit Profile

Obtaining a personal loan can also help you build your credit profile to make it easier for you to obtain financing in the future. The best credit scores are reserved for those that have demonstrated that they can use different forms of credit responsibly. Having a personal loan that was repaid in a timely manner displayed on your credit report can show lenders that you will not be a default risk if they extend a loan to you. You will have a better chance of having your application accepted and will be offered a lower interest rate than you would get if you had a higher risk of defaulting.

Increase Your Net Worth

Using a personal loan wisely can help you increase your net worth by a significant amount. For example, if you use the money from the loan to purchase a vehicle, you increase your earning potential because you can travel farther for employment and have reliable transportation in any weather. You can also use the loan to make improvements to your home before attempting to sell it, increasing the value of the home and the profit you will receive on the deal.

It is important to use the personal loan for something that will add some value to your life and help you move forward towards financial stability. Wasting the loan on frivolous items like clothing or vacations will come back to haunt you in the future. Make the decision of how to use the personal loan carefully to ensure that you are making the right choices to meet your financial goals.

Photo by Cooperweb

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DINKS (Dual Income No Kids) Finance focuses on personal finance for couples. While by no means financial experts, we strive to provide readers with new, innovative ways of thinking about finance. Sign up now to get our ebook, "Making Money Tips for Couples" FREE.

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