Why Shouldn’t I Borrow to Buy Something That Depreciates In Value

Usually people that have a better understanding of their money and finances usually do not get a loan  or avoid getting one at all times. This is for a good reason, the stress of paying back a loan is not wonderful at all; but that does not mean that all loans are unacceptable and bad ideas, some are actually very useful and healthful like a mortgage or house loan. But still a large percentage of loans are unnecessary and most likely very troublesome to pay back.

What is Something That Depreciates?

Something that depreciates loses value over time. Some examples of things that depreciates are, cars, houses, clothing, etc. 

The reason why these things depreciate in value is because these things get old and worn out over time, and they don’t last long except maybe for a house. A car when you drive it out of the parking lot where you bought it loses a huge percentage of its value, that is the reason why most people buy an already used car since it loses value less rapidly. A car is an item that loses its value very rapidly, houses on the other hand loses its value much more slowly but it still is something that depreciates in value over time.

Something That Does Not Depreciate?

Things that don’t depreciate in value over time are paintings(they actually may rise in value if the artist is famous), gold, and jewelry, a lot of people get loans for these items, but it is a foolish idea to get a loan for these items still, even though these things don’t lose value.


Loans should be mostly avoided, except maybe if you want to start a business and need a loan to get started, or a mortgage for a house, and a car loan, these loans are fine and very common and normal to get. But getting a loan for an unnecessary item, is pointless since it will most likely leave you in a pile of debt. If you don’t have the money for an item save up for it and be patient or reconsider if you actually really need the item.

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