Is It Bad to Borrow Money for Christmas?

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( — July 20, 2020) — The festive season is quickly approaching. Are you ready for it? You know what I mean when I ask about your readiness. Christmas is one of the most important days of a year. Most people look forward to it with a lot of expectations. It means a lot to people, irrespective of the ages. For instance, the most memorable days of my life as a young boy include the moments I used to spend with friends. But being ready for Christmas involves a lot. You need to be in a position to gift people, for it is an excellent way of letting them know how much you love them.

You are supposed to come up with a list of everyone that you intend to gift and establish an approximate cost of what you are going to spend. But here comes a question – what if you are short of funds? Can you borrow it? Knowing how important this day is, you are determined to make it count, even if it means borrowing. There are so many personal loans branded as “Christmas loans,” and lenders will be more than willing to approve your application. In fact, during the festive season, lenders benefit more. If you think you of taking a loan, consider Instant Cash Loan Singapore. But again, is it a wise decision to borrow? Well, the purpose of this discussion is to help you make the right judgment. Specifically, we are responding to the question of the question – is it wrong to borrow money for Christmas?

Why People Borrow

There are different reasons why people borrow money, and some of these reasons can be considered to be legitimate. For instance, think of a guy who really wants to buy a home. Being a homeowner is a desire of nearly each and every person. The decision to take a mortgage loan is, no doubt, legitimate. Yet there are so many factors to be considered before making this decision. In fact, after serious considerations, several individuals opt for renting rather than buying. Also, think of someone who intends to borrow to pay the college fee. This is an opportunity that can better someone’s skills and earn even more in the future.

It is wise to borrow to take advantage of an opportunity that can earn you more funds in the future. Whenever you borrow money, you are supposed to look at it from an economic standpoint. A loan is an obligation, and you will have to repay with interest. Where you put borrowed money is very important. It is vital to use the money in a way that will help you repay the loan. So why do people borrow? For different reasons, and sometimes what is legitimate from your standpoint, might be illegitimate from another person’s point of view. So, the reasons for borrowing boils down to specific individuals.

Should You Borrow for Christmas?

Are you willing to borrow and buy that expensive present for your loved ones? However, much it sounds good, it is a wrong decision. There are several ways of extending an individual’s purchasing power, yet they all involve some sort of credit. If someone told you there is good debt, you were lied upon. Borrowing for a holiday is not a wise decision, and you really need to avoid that snare to the extent possible. Let us illustrate why.

Why are you borrowing? Because you do not have enough funds, Right? But how are you going to spend the borrowed money? On buying presents and treating the day. How do you categorize these kinds of spending? You are actually spending the borrowed money on luxuries. Do you think that is an excellent idea? In other words, you are using the money that you do not have on luxuries. This amounts to poor spending habits. In fact, you can be equated to that guy who lives beyond his means.

So, in response to the question raised at the beginning, it is terrible to borrow for Christmas. It amounts to an unfortunate financial habit and can damage your financial status now and in the future. But what exactly makes it that bad? The following are some of the reasons why borrowing for Christmas may lead you to several problems.

It Makes Christmas Too Expensive

We said earlier that there are different ways of prolonging your purchasing your power. But we also said nearly all of them involve credit. While borrowing might appear to be extending your purchasing power, the real effect is the exact opposite, it lessens your buying power. This comes in two ways. First, borrowing means you are actually going to incur more on presents compared to what you would otherwise do had you been restricted yourself to the cash you have in hand. Second, you will be required to pay the loan amount along with interest. This implies that you will be paying more than the actual price of the products in case you are using credit.

It Leads To Habits and Expectations

Borrowing for Christmas establishes a foundation for undesirable habits as well as behaviors and expectations, even the subsequent years. You end up setting a dependence mentality, finding yourself deeply entrenched in debt. Worse still, borrowing also sets an inappropriate precedent and impractical expectations. When you give loved ones quite expensive gifts, they will definitely expect the same or even more in the coming year. You will find yourself in two significant traps; debt and acquiring your loved ones’ expectations.

You Begin the Year Low

What do you expect when you borrow for December 25, when next week will be a new year? You will be required to settle your bills and make payments for the charismas loan. Will that really be merry? You need to think of getting out, not into debts.

The Bottom Line

There are so many legitimate reasons for borrowing. Unfortunately, Christmas is not one of them. Borrowing for Christmas will only complicate your financial status. We have discussed how you can be affected if you go down that route. But there is something we forgot to tell you. You don’t want your children to learn bad financial habits, right? Be an excellent example of what responsible spending stands for. Children grow up learning from their parents. They will definitely adopt what you personally do at the moment. Let them not learn a bad habit of borrowing for Christmas. The decisions you make as a parent right now may be reflected significantly in your family longer, even for generations. Thank you!