If you ever decide that your monthly pay packet just isn't
enough to fund your chosen lifestyle there's help on hand.
There are literally hundreds of finance companies out there
just waiting for you to pick up the phone and place your
order. $500 or $100,000how much would you like? Sure we
can help you, just let us get our claws into any sort of
asset you may have managed to acquire (in the days when you
or your partner/parents used to save) and we'll give you
the cash.

Why would anyone want to save for that new couch when you
could have it todayno deposit, interest free for 12
months? Tempting, very tempting and it could be in your
lounge tomorrow. While you're at it why not take home a
nice rug to keep the kids' feet warm. This one here goes
perfectly with your new couch. Once your finance application
has been approved you can throw in the rug and just add
it on to the balance. It couldn't be easier and it couldn't
be more dangerous.

Sooner or later it all has to be paid for and that's not
just the price of the couch but also the price of the money
used to buy the couch all those months ago. By the time your
lounge is starting to look a bit dated and faded and the cat
has scratched the rug bare you're probably about halfway
through your relentless, monthly payment schedule.

It's no wonder finance companies get a bad rap. We deliver the
goods, whether it's a new couch, new car or even a new house
we guarantee immediate satisfaction. The problem is that as your
satisfaction wanes our bill grows and one way or another, you
will pay. So we start to control you and your lifethe one
thing that New Zealanders value above all else, their freedom
is eroded.

But hang on a minute here. If it weren't for finance companies
none of us would own the houses we live in, none of us would
be able to invest and reap the rewards of interest income. The
impetus behind economic growth comes from people's ability to
borrow, say, $5 for every $1 they own. Then you get any return
on $5 rather than your measly $1. Borrowing money is smart if
you do it right!

As long as you invest your borrowed money in something that
earns more than your cost of borrowing itit makes sense.
Buying appreciating assets, investment properties, upgrading
property to sell on or funding income-producing businesses
does make sense.

One of the most important things is to match your funding to
your project. Keep the term of the loan the same as the term
of the project. If you are borrowing to purchase a property,
upgrade it and then sell it onstructure the loan to match
this. Keep control of your investments and don't let them
control you. Make sure you use a finance company with integrity
and a reputation for repeat business. Your finance company
should be your partner, not your parasite.

Article written by Louise O'Brien.