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10 Useful Reasons Why Singaporeans Take Out Personal Loans

It’s quite fascinating how Singaporeans take out personal loans. We listed the top 10 reasons why they apply for it.

Are you scared of taking out personal loans?

Singaporeans have been raised believing that loans could be bad for their finances.  However, you should not forget how useful it can be if used wisely.

Choosing the best personal loan and using it smartly can strengthen your finances. Also, it can perhaps even affect your personal relationships. Have you ever asked yourself:

“What Can I Use a Personal Loan For?”

10 Useful Reasons Why You Must Take Out Personal Loans

Avoid making insurance claims.

Got insurance? Have you read the fine prints before signing up? Some insurance policies give bonuses to those who do not make insurance claims for a while.

In addition, some insurance policies limit the number of claims for a certain period. As a result, some Singaporeans opt to take out personal loans. Their reason is to avoid making a claim if it is just a minor claim.

You will not know if you’ll need to claim something more severe in the future. Also, getting a loan can assure that you can still get the bonus by not making a claim.

Keep your savings while making a huge purchase.

Let’s say you saved up $15,000 for a grand family vacation in Bali. Are you willing to spend this amount all on your getaway?

What if an emergency suddenly arose during the holiday? However, you have already used up most of the money in your savings? 

Isn’t it better to just get a loan and pay the amount in instalments? It assures you that you still have your savings? Savings gives you peace of mind during unexpected circumstances. However, spending most of it could put your finances in shaky situations.

Take out Personal Loans to purchase wedding rings.

Do you often use your credit card to purchase your wedding rings? Why not take out personal loans instead? Why? Because credit cards will absolutely charge you enormous interest rates. Sadly, it can blow off the roof.

You may choose the instalment feature of your credit card. But, failure to pay off the monthly dues will indeed bring disaster to your finances.

Take out personal loans with a low-interest rate. For example, personal loans offered by legit money lenders have interest rates capped at 4%.

Take out personal loans to purchase wedding rings

Credit: https://www.michaeltrio.com/wedding-rings

Avoid using Credit Cash Advance.

One of the features most credit cards have is the cash advance. You can withdraw a certain amount charged on your card’s credit limit.

Instant cash it is! However, it comes with a tricky price. It will charge the money you withdraw with a processing fee and an interest rate. Also, the charged interest is daily. It continues to charge until you finally settle the amount.

You can help your family and friends.

Money matters with relatives and close friends can indeed be tricky. There are times when an emergency may come up, such as a medical condition. If you are a close-knit family, asking for your financial help is typical. Or it is the other way around. 

However, there are a lot of stories that come with it. Sometimes, relatives or friends do not pay the amount they borrowed. If this happens to you, you will be with low savings. Also, you have broken relationships.

That is why you should not risk your savings. You will never know when you will have to use it for your emergency. Instead, take out personal loans. In addition, you can easily pay off in instalments. Then, give the funds to your relative or friend. This way, you have saved your savings.

Also, tell your family or friend that you took out the loan for them. It will give them much weight to pay back. Thus, it saves you from the burden of the borrowed money.

Debt consolidation

You can take out personal loans if you’ve got multiple credit card debts. It aids in covering these. Also, it is beneficial. You do not have to keep track of a couple of due dates.

In addition, a personal loan can pay off your credit cards without having to get another credit card for a balance transfer.

Home renovation

Banks usually offer home renovation loans. But what if you just want to make a minor renovation? Then, you can opt for a personal loan.

Also, what if you have already used up your renovation loan? Then, use a personal loan to finish up the work. It is the best solution to complete your home refurbishing. Plus, it is better than leaving part of your home half-finished.

take out personal loans for home renovations

Credit: https://thesmartlocal.com/read/hdb-renovation-singapore/

Late payments

Some workers still receive late payments. Unfortunately, it happens despite the strict regulation of the Ministry of Manpower.

You would have died of starvation by the time you get your salary. But if you take our personal loans, it bridges the financial gap. Plus, it is manageable. Choose a repayment term that fits until your next paycheck.

Time-sensitive purchases

Let’s say you have been eyeing an item for a long time. Also, you have been trying to save for it. But, it suddenly went on sale. However, your savings is still not enough. So, you can get a personal loan to buy it finally.

Avoid borrowing from family and friends.

Many Singaporeans still value their pride. They are even willing to get a short-term loan rather than asking for help from their families and friends.

Personal loans are useful to pay off bills. Also, it aids in lending to the family and friends. Plus, it helps you to survive until the next payday. Therefore, it is multi-purpose and flexible.

However, you need to be smart when choosing the right personal loan for you. Cash Mart offers quick cash loans with a seven-day guarantee. With decades of experience, Cash Mart understands that our needs have become dynamic. So personal loans should also be more accessible.

Need to know more? Visit CashMart.sg now or call at +65 6397 4111.