In Search of a Better Life: Turning Your Loan Into an Asset

We have so many material goals in life. We want to have our own home, car, and maybe manage our own business. Unfortunately, most of us belong to the salaried strugglers who could only dream of even having a million in our bank account. What then can we do? There are ways we can fake it to make it. That’s called taking out a loan.

However, we must make a loan work for us instead of it making us work double-time to pay it off. If it’s just to buy something to show off, it’s wasting money. It’s just faking it without really becoming the successful and financially free person we want to be. Turn your loan into an asset that could make money.

Invest in real estate

Real estate is a good lifetime investment. If you carefully plan your acquisitions, you could earn money from it. It’s one of the purchases you could rest assured would be worth a loan. However, you have to make sure that you get a prime location. There are also packages for both land and house. It doesn’t matter if you like the house if you see that it is in a good location. You could simply remodel the house later on.

What makes a location prime for could depend on your priorities. If the property would be for your use, you should consider your needs. Do you want to live near a commercial district? Do you want to live in a quiet zone? Do you have a car? Or do you have to commute?

If, however, you are after land appreciation in the future, what you need to consider is the development nearby. If malls or business districts are being constructed or are being planned around the area, it will surely rise in value once those commercial hubs are in place. These would also be your consideration if you plan to rent out this piece of property.

Other things you need to study are the accessibility and reliability of basic needs. Will it have problems with electricity or water should there be weather disturbances? What is the condition of the roads? Is it accessible by another route if something happens on the main road? These are things you need to ask.

Some people have invested in condominiums and flats in metropolises. These cities would always have people looking for accommodations. If you could loan enough to already start occupying it, you could rent it out and use the rent to pay off your loan.

Purchase a car

driving a car

Although an unlikely investment idea before because of its accompanying maintenance and service fees, a car is now good for some side hustles. With Uber, Didi, and other on-demand cars, you could drive people during your spare time and use this money to cover your maintenance fees. Those who don’t have regular jobs could even earn enough through this for living expenses and to pay for the car loan.

Pursue higher education

They say you don’t need degrees anymore to get a job. You only need networks and connections. But a connection is not enough to get you promoted or get you a salary raise. You need to invest in your career. Get an MBA or a proficiency certificate in some technical skills. It depends on what field you belong to whether you would need higher degrees or you simply need to accomplish skills training. You could always work while you study so it’s not like you’re putting your income on hold.

Other than going up the corporate ladder, you could also use your degrees to break free from a restrictive day job. If you have enough credibility in your field, you could use your name to set up a consultancy firm. So go ahead and invest in your credentials.

Starting a small business

Unless you have already done a market study, try not to make any loans yet when you start your business. Take out a loan when you are already expanding. Try to wait until your assets would value more than your loan. That way, if something happens, you would have something to cushion your failure since you already have a net gain.

Because of the consumerist society we have today, several loans have become available to us. Be it a salary loan we could use for an end of season sale, or a business loan to try our hands in the business. The easy process of taking out a loan is very tempting. And the government even offers debt help. But always, think if you could pay off the loan without adding to your workload. Better yet, use the loan as leverage to gain financial freedom.