6 Everyday Goals a Personal Loan Can Help You Achieve

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Personal loans are solid options for medium-sized expenses that are a little too big to pay for upfront, but not quite big enough to warrant dipping into your savings or maxing out a credit card. As long as you have a decent credit score and can afford to pay back the amount you borrowed in full and on time, a personal loan can be a manageable way to help you achieve everyday goals, like upskilling or moving across the country.

Here are six everyday milestones a personal loan can help you reach without leaving you in debt you can’t handle.

1. Moving

According to Zillow research, people pay an average of $475 to professional movers for local moves. If you’re moving across the country, expect to pay even more. And that’s not even considering buying new furniture if necessary.

A personal loan can make financial sense, especially if the move is necessary or ends up saving you money in the long run. For example, if you’re relocating for a better-paying job or moving into a place with lower rent. In that case, a short-term loan might be worth it just to get you settled faster.

2. Taking a Class or Getting a Certification

If you’re feeling stagnant in your career or want to pivot to a more lucrative path, you may need to invest in upskilling (and those courses can be expensive). For example, many coding bootcamps cost over $10,000, which isn’t exactly pocket change. 

In this case, personal loans can be a great way to fund your professional development, especially if you don’t qualify for traditional student loans or don’t want to drain your emergency fund. Plus, if the program boosts your earning potential, it could pay for itself once you graduate from the program. 

3. Launching a Side Hustle

You don’t always need a massive startup budget to launch a side hustle or business, but you may still need some cash upfront. For example, to buy supplies, set up a website or pay for marketing. 

​​That said, it’s important to have a backup plan in case things don’t go as expected. Also make sure you have a reliable source of income, like a full-time job or steady freelance work, that can cover the loan payments if your business takes longer to become profitable (or doesn’t pan out at all).

4. Consolidating Small Debts

Even though it’s still debt, using a personal loan to consolidate multiple high-interest balances, like credit cards or payday loans, can actually help you get your debt under control. This is because you can combine everything into one monthly payment, usually with a lower interest rate and a clear payoff plan.

In other words, while consolidating debts with a personal loan doesn’t solve the problem overnight, it does make things more manageable. Just make sure you don’t rack up new debt on those now-empty credit cards.

5. Handling Irregular but Expected Expenses

Seasonal or one-off expenses like holiday travel, tax bills, home repairs or back-to-school shopping can quickly drain your bank account. A personal loan can help cover these expenses in a pinch, as long as you borrow a reasonable amount and commit to paying it off quickly.

Ideally, you’d have a sinking fund set aside for these kinds of expenses. But if you’re still getting your finances in order and don’t have savings to fall back on, a personal loan can serve as a short-term solution. Just make sure it stays short term. Also, only borrow what you know you can repay, and have a clear plan to avoid turning a temporary cost into long-term debt.

6. Covering Small Home Improvement Projects

Though large home renovations, like completely rebuilding a new kitchen, may make more financial sense with a home equity loan or a HELOC, less expensive home improvement projects can be done with a personal loan. 

For example, if you’re planning projects like installing new windows or floors, repainting or upgrading your landscaping, a personal loan can help cover the costs without tapping into your home’s equity.

Use Personal Loans as a Tool, Not a Crutch

If you’re thoughtful about what you’re borrowing for and ensure you can handle the monthly payments, a personal loan can be a tool to help you achieve certain goals. 

That said, it shouldn’t be used just to have extra spending money. Since personal loans are unsubsidized and unsecured, interest rates can be high, and missing payments can hurt your credit. Use them as a last resort, and only when you have a solid plan to pay them back.  

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