Is taking loan for investment is a right choice
The best way of doing investment is to save few amount from your expanses and put portion of saving in your investment but majority of people don't have funds available for investment. As a result they opt to take loan for the investment. Now, the first question comes in mind is this a right choice to take loan for investment.
Straight answer of this question is Yes and No. Strange. Not at all. Actually it depends upon the type of loan you take for investment. If you take interest free loan from family members or friends, it is not a bad option as long you have emergency funds available in your holding. So, in case you face the loss you can return borrowed money from your emergency investment. Same way taking loan on lower interest rate is not a bad option either but the condition remains same you have some backup emergency fund available, so that you may pay your instalments in time even you observed loss in your investment.
Before investment it is important to do your own research about the project suitability for investment. You must have prior knowledge about the project before jump in to project. Never invest money either your saving or loan amount if you don't have know how of the project. First develop your skill and learn the art than invest in any project.
It is a fact that risk is associated with every investment. So invest at your own risk. The best option is to spend only those money which you can afford to loose. What is your opinion my friends?
This is it for my today post. Wish you all a very happy, healthy and prosperous life ahead. Have a nice time.
Some might claim it is a right option and some might claim it is no. It point down to personal preferences but as for me, it is not a wise decision to start an investment with a loan
I would like to say two things here that the first thing is that one should never take money from any place and put it in the market. And the second thing is that now we also know that there is some time left to go up in the market, so one should also take sustenance in life.
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I have changed the image as per your guideline. Thanks for the correction. stay blessed
Thanks for sharing this post, I appreciate your effort.
Personally, I have always been against, or should I say I was never a supporter of borrowing loan to make an investment. I see it as such a crazy idea 💡 that has placed so many people in trouble.
I mentioned something in my yesterday's post, which I said "The term investment has being an over emphasized word which has drifted so many people's attention far from it". People now thinks that we must have large amount before we can make investment, which is absolutely wrong.
In conclusion, I would advice starting small than borrowing.
The big companies take loans to run their businesses but on the small scale I would never go to ask for loan. This is risky.
Borrowing loan from banks or other organizations is really not a good idea because most of this loans comes with higher interest. So operating your business with loans is like working for other people because the profit you make will still go the people you borrowed loan from which might really not be a good favour to your side but depends though.
Sometimes, we don't have resources but there is a very promising opportunity right in front of us. At that time taking a loan (but interest free) proves to be the best decision.
no, i don't think so, it will put some extra pressure on you.
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For every loan we need a collateral and when you are investing into a new venture there is risk involved there as well.
So one need to see the cash flow that comes with the new venture to pay back the loan.