Nearly everyone needs to borrow at least once in their lifetime and this is nearly always to purchase a home. The best time to borrow is when you have job stability and no other debts, so that paying it back is affordable. It’s not so much the amount you borrow that makes paying back difficult, but the amount of interest tacked on to the capital.



Never borrow more than you can afford to pay back. If you can possibly save up for what you want, do so rather than borrowing the amount. It might take you longer to attain your goal, but it will be heaps cheaper in the long run. A smaller amount such as for a holiday - that you could actually do without - really is better off saved up and paid for rather than you having to fork out all that interest on top of the loan.





A car or holiday will lose value as soon as you’ve purchased them. At least if you borrow to purchase a home it has a chance of appreciating and so in the end you’ll have something worth having. Even a home loan should not cost more than a third of your take-home pay to pay back each month. Work out the repayments on what you hope to borrow, then try saving that amount each month. Remember you’ll have to do it for 20-25 years once you start.