Written by Lidia Staron
Money is essential in our lives because we use it as a currency and as a means to get what we want. If you want to buy a house, you need money. If you want to buy a car, you need money. If you want to buy any food that you desire, you guessed it: you will need money for that as well.
There are plenty of ways to borrow money. The most obvious would be from your work salary. But, there are instances where times get rough and you need more cash just to get by. Did you know that there are unusual ways people can borrow money? I will go over some of them in this article, so read on to find out what they are.
1. Friends and Relatives
Something that is quite obvious, especially in Eastern culture, is borrowing money from friends and relatives. The reason why this is commonplace in the Eastern part of the world, specifically in Asia, is due to the simple reason that they follow a culture of collectivism wherein people help each other in any way they can.
Western countries are geared towards being individualistic where people are taught to work hard with the notion that no one might help them. But, that is just not the case at all. It is inherent in friends and family to help whoever is in need, most especially any of their loved ones.
So, if you need money, go directly to your close friends and family and ask from them – just be sure to pay them back to avoid souring any relationships!
2. Peer-to-Peer Lending
Another way of borrowing money is to actually do so from someone who is willing to lend you some dough. What I am referring to is Peer-to-peer Lending and it is just a process that involves a borrower and a lender and they come to an agreement so that the borrower can get some money, in exchange for some interest rate, of course.
This is a perfect way to get some money as it doesn’t involve too many documents and other details. All you have to do is put it into writing so that both of you can feel safe.
3. Online Loans
Most people, especially the Westerners, use this option of borrowing money. Getting a loan is actually the most common way to have money in the bank. There are plenty of loans out there, but people are enjoying some of the online options including personal loans online, cash advance online, and many others.
4. Retirement Fund
All of us will retire at some point and it is important that you set up an IRA or your Individual Retirement Account. This will serve as your retirement fund so that in the event that you will have to retire due to old age, you will have money ready.
Although it acts as a savings account, you could actually “borrow” some of the money inside the account if you really have to. To avoid early withdrawal penalties, however, make sure that the cash that you’re going to withdraw can be replenished by the date specified by your fund.
While generally not your conventional way of ‘borrowing money’, crowdfunding is a great way to acquire money that is specifically used for your startup company or product.
If you’re looking to put up a business, for example, and you just need a little bit of a capital push, then crowdfunding is a great way to “borrow” some cash. You can give back to your donors by giving them a quality product or service.
6. Home-Equity Loans
Getting a personal or business loan can prove to be difficult, especially if you have a sub-optimal credit score (any number below 700). Borrowing some money by using your home as a collateral is a good way to get that financial push that you need.
Do note, however, that this can be risky because if you somehow default on this loan, you could lose your home in the process.
7. SBA Microloans
The US government encourages people to have their own business as they are offering microloans that help promising startups. You could borrow some money from a major financial institution like a corporate bank, for example.
You just have to prepare your business plan beforehand and you also have to think about the interest rates as well.
8. Work and Earn
The best way to borrow money is to actually not borrow at all. What? I know this sounds counterintuitive, but when you look at the big picture, if you just have the means to pay for anything that you want in life, there really is no reason to borrow some cash.
If you do happen to need more, why not work two jobs? You could definitely set your priorities to give yourself the ability to work full-time and also get a part-time job as well.
Some people work in a 9-5 job and they also either engage in business or they turn to freelance jobs instead.
Whatever it is that you desire in life, there is really no need to borrow money. If you are resourceful and hardworking, you will definitely earn the money that you need and deserve.