Ways to use a personal loan

Let’s talk about personal loans – and no, we don’t mean borrowing a housemate’s laptop or $20 from the ‘bank of mum and dad’.

A personal loan can help you take control of your finances and streamline your debt, or finance something big. It’s a way to make significant things happen. So how exactly can a personal loan help? We help answer this with the creative genius of Unlikely Expert and illustrator James Gulliver Hancock.

Put an end to divided debts

From store cards to credit cards, most of us have debts. And when we have lots of different debts, it can get complicated – especially when missing payments means paying penalties.

You could take charge of your debt by rolling it all into one personal loan. This is known as debt consolidation. Essentially, this means the bank pays off your other approved debts so you’re left with just one to manage and pay off.

Personal loans generally have a lower interest rate than credit cards so you might be able to pay your debt down faster. They can also help you resist the temptation to go on a spending spree because there’s no linked card.

An illustration by James Gulliver Hancock of a clamp closing in on various debts.

Let’s get this show on the road

For many people, a car is a necessity. It’s also something that can take a long time to save for. One way to get behind the wheel sooner is to buy a car with a personal loan, and pay it off each month.

Getting your loan pre-approved before you start shopping for your car helps you know how much you can spend and could enable you to negotiate on price if the loan is approved. A personal loan means knowing exactly how much you’ll pay each month, and exactly how long it’s going to take to pay it off.

An illustration by James Gulliver Hancock of a car with money going in.

Getting your personal loan approved before you start shopping could enable you to negotiate a price.

The holiday hall of fame

There are some experiences in life that only happen once, like an overseas trip with a group of close friends, a honeymoon, or a reunion on the other side of the world. Sometimes a trip comes up that you just can’t miss. This is where a personal loan can make all the difference and help you cover upfront costs.

An illustration by James Gulliver Hancock of various global locations, laid out on a map.

When you should put a ring on it

Your wedding is an experience you’ll remember forever, but budgets can often be blown out for the big day. A personal loan could come in handy when it comes to budgeting and knowing how much you have to spend. Paying with a personal loan might mean that you pay less on interest than paying with a credit card.

An illustration by James Gulliver Hancock of an engagement ring and wedding celebration.

Getting those home improvements underway

Is it about time to landscape the garden or upgrade the kitchen? Depending on the size of the project and your budget, a personal loan could help you get your home renovations underway sooner rather than later.

So there you have it. A personal loan can be one way to streamline your finances, helping you consolidate your debt and start budgeting for a healthy financial future.

Just because you don’t have a lot of money saved up doesn’t mean you have to miss out on the really important things when they come up in life.

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Things you should know

The information contained in this article is of a general nature and is not intended to be nor should it be considered as professional advice. You should not act on the basis of anything contained in this article without first obtaining specific professional advice. Also to the extent permitted by law, Bankwest, a division of Commonwealth Bank of Australia ABN 48 123 123 124 AFSL/Australian credit licence 234945, its related bodies corporate, employees and contractors accept no liability or responsibility to any persons for any loss which may be incurred or suffered as a result of acting on or refraining from acting as a result of anything contained in this article.