What Can You Use a Personal Loan For?

I abhor debt. Any debt that isn't a mortgage is debt that I abhor. However, sometimes there is no choice but to take a loan, sometimes there are expenses that you can't have expected or trying financial situations, however before you do take a loan, think long and hard about whether you need that loan or not. Here are some reasons why people think about taking a loan.

Even the most cash-savvy person can run into an unexpected expense that derails their financial plans. When no amount of saving or cutting costs can solve your problem, sometimes it makes sense to go for a temporary solution—a personal loan that will give you a cash infusion. Personal loans have pros and cons like all financial options, but it's important to understand all it entails before committing. Be sure to do your research because some personal loan options are better than others and will fit your needs better.

What Is a Personal Loan?

A personal loan is one of the most straightforward ways to get a cash infusion when you need it. You apply through a bank or other provider and receive a lump sum of the entire amount you're borrowing that you can spend immediately. The loan has a fixed payback rate, usually ranging from one to ten years depending on the size, and the interest rates are fixed until payback is complete.

The application process should be familiar if you've applied for a credit card before. The loan provider will want to see your credit history, and you should bring proof of income to confirm that you have the assets to pay it back. For larger loans, you may have to add collateral or bring references, as the risk to the lender is higher. Make sure to check reviews for AmOne and other providers for details on terms.


Many people like personal loans because there is much less oversight into what you plan to spend the loan on than other financial dealings. Personal loan providers only care about whether your ability to pay it back, and the rest is, well, personal. That's why many people choose to take out a personal loan to afford a once-in-a-lifetime vacation.

It's likely many people will get bitten by the travel bug as the world continues to reopen post-pandemic, and that will lead to ambitious travel plans. Even the most carefully planned vacation can run into unexpected costs, and sometimes people decide to go all-out and indulge in luxury. Or you might legitimately need a vacation for your mental health, even if you don't have the budget for it. These are some of the many reasons why someone would take out a personal loan to pay for a vacation. 

Major Life Events

When analyzing the pros and cons of personal loans, many people are drawn to them when dealing with a massive, once-in-a-lifetime event. The most common major cost for couples is a wedding, which now comes with a price tag that averages over $30,000. Couples want a day to remember, which some people feel is worth taking on debt.

On the other end of the spectrum, some events can't be saved up for. Funerals happen unexpectedly and have major costs involved. To pay proper tribute to their loved one's life, many people are willing to commit to a loan. You may also need to take out a loan when having a baby if the baby comes at a financially difficult time for you. While the costs of this event are often much more spread out, this is a long-term commitment, and many couples would rather have some extra cash on hand for when the baby arrives.

Home Needs

Sometimes, all it takes is one fuse blowing to send a family's budget out the window. Home repairs can be costly, especially if it involves a major house system that can't simply be replaced like an appliance. If you need a specialist to come and fix something in a hurry, it may be a major expense that will require some extra cash on hand.

Not all home needs are due to something breaking. Sometimes it's just time to give the home an upgrade, to make an addition of an extra room for your family's needs instead of moving somewhere larger, or install something you've been looking to add for a while. Inground pools, new decks, or other recreation facilities can require weeks of construction and many decisions, and making a bigger investment upfront can lead to a longer-lasting project.


If you run into a medical emergency and insurance is either tapped out or refusing to pay, there might be no choice but to take out a personal loan. The fees on short-term loans can be high, so be sure to research options for the most reasonable cost. Paying out-of-pocket for medical costs or other emergencies is never ideal, but the best loan providers can take the sting out of it.

Borrowing While Informed

Taking out a personal loan is a big decision. Not all loan providers are created equal, so make sure you're informed. That way, you can cover your major costs while maintaining your long-term financial stability.

Penniless Parenting

Mommy, wife, writer, baker, chef, crafter, sewer, teacher, babysitter, cleaning lady, penny pincher, frugal gal

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