Editor's choice: LendingClub personal loans
- Coapplicants welcome
- Check your rate without affecting your credit
- May qualify with a credit score of 640
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You’ve been responsible for your personal finances for a while now and generally know how things work. You might have even paid off a personal loan or two.
When used responsibly, a personal loan can help you through financial tough spots and build solid ground for the next phase of life. But be careful of taking on more unnecessary debt that can hurt your financial stability.
You can benefit from a personal loan in your 40s to pay for unexpected expenses, make improvements to your life and home or to get yourself back on financial track. Carefully consider your unique situation and how a personal loan could help or hurt.
If you’ve had nagging health problems you’ve been putting off for years, avoid possible expensive medical costs in the future by taking care of them now.
Your health insurance might cover routine procedures, but not everything. And while some providers offer in-house financing, it might not come with as favorable rates and terms as a personal loan. Here are some healthcare scenarios where a personal loan might come in handy.
If your parents need assistance, chances are they aren’t earning the income they need to take out a loan themselves. A personal loan can help cover one-time costs like medical procedures or home improvements that they need now but can’t afford up front.
Personal loans aren’t great long-term solutions, however. Consider other senior care financing options if you need help with day-to-day living costs.
A personal loan can help you start a family and build the foundation for your children’s futures. Here are several ways to use it.
A personal loan can be used for emergency fixes like a damaged roof or mold problem that could hurt the value of your home if left alone. And if you make energy-saving changes like installing solar panels or low-pressure faucets, you could end up saving on utilities.
Or you might want to save up for less-urgent renovations, like retiling your bathroom or installing a home sensory deprivation tank. A personal loan can help with these expenses, too. And even better, these improvements can increase the value of your house if you want to sell.
The average credit score for someone in their 40s is 685. That’s 14 points higher than their 30-something counterparts, and 33 points higher than someone in their 20s. If you’re paying off a personal loan, car loan or private student loan, consider refinancing if your credit score has increased.
And if you’re struggling with credit card debt, look into using a debt consolidation loan to help you pay it off at a more competitive rate.
Taking on extra debt when it’s not necessary can hurt you down the road. If you find you can’t buy the things you want, you might be tempted to take out even more loans. Or worse, you won’t have enough to retire when you planned. Here are a few situations when avoiding a personal loan could be a smart move.
Investing in stocks and bonds is risky — that’s why people have the potential to make big money. But the stock market is unpredictable. Borrowing money in the hopes of making money is a gamble that could leave you worse off than when you started. If your stocks lose value, you’ll still have to pay off the original amount you invested, plus interest and fees.
Instead, consider upping your 401(k) contributions at work and opening other retirement accounts. If still want to invest on your own, you can use apps like Acorns to invest your change when you make purchases.
You might have the personal and financial freedom to buy that boat or motorcycle that you’ve always wanted. But taking out a personal loan to buy an expensive luxury item makes it more expensive in the long run. Instead, consider making a budget and saving up until you can afford a good chunk of it on your own.
While a personal loan can help out with time-sensitive costs like medical bills or back taxes, it shouldn’t be the first option you turn to.
You can often negotiate your medical bills with your insurance provider or sign up for an interest-free payment plan. Some hospitals even offer unadvertised discounts if you pay the whole thing up front. If you’re struggling with your taxes, ask for an extension or a repayment plan before you take on debt.
Personal loans can help set yourself and your family up for a bright and stable future. But taking on unnecessary debt at your age can make things a lot more difficult when you’re ready to retire.
If you want to learn more about how personal loans work or compare lenders, visit our guide.
If your child gets sick or injured and has to take time away from college, tuition insurance can reimburse you for what you already paid.
Look to local resources to avoid shuttering your business this winter.
Also known as Hometown Community Bank, this Illinois lender offers programs tailored to local businesses.
This small bank serves small and midsized businesses in Southwest WA and Portland, OR.
This Wisconsin bank offers special programs for agriculture business and nonprofits at seven branches.
Agriculture loans, real estate financing and more from this Eastern Missouri lender.
This Chattanooga bank offers basic business and personal financing in Georgia and Tennessee.
We break down why it might not be a good idea for all borrowers.
A relatively high-tech community bank with over 240 branches.
Large for a community bank — but not without a personal touch.
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