• Use loan money for one of the following reasons and feel confident that it is worthwhile.money image by cherie from Fotolia.com
  
  There are numerous reasons why people borrow money, and often those reasons are good ones. Don't let the burden of debt discourage you from taking out a loan if there is a legitimate purpose for the money. Evaluate your financial situation carefully and make sure you can afford to pay it back according to the terms of the loan.
  
  

Buying A Home

• Buying a home is a purchase that few people can make without the help of a mortgage. While this purchase may be the largest amount you ever spend, real estate investments generally work to the buyer's advantage in the long run. If a home is kept for an extended period of time, history suggests that the value of the home will rise and the property will gain equity. In addition, the monthly cost of a mortgage is often less than paying rent, according to The Globe and Mail website.
  
  

Education

• Loans for college or training allow people to secure better financial futures through their careers. People who complete a college education have a higher earning potential than those who do not, according to WorldVillage.com.
  
  Student loans are often offered at competitive terms. Government-guaranteed loans often have low-interest rates and a flexible repayment schedule that does not go into effect until after graduation.
  
  

Emergencies

• An emergency may not be the best time to borrow money, but it may be necessary. If emergency circumstances require quick cash, remember to borrow only what you need.
  
  Emergency borrowing may be related to medical expenses, temporary loss of employment or natural disaster recovery. There are a number of sources of emergency funding, but many of these lenders--such as payday loan distributors--charge a flat fee that equals an extremely high interest rate, according to Credit.com. Consider these types of loans only if you're certain that you'll be able to pay the loan back and your need is truly urgent. People with good credit can typically go through their bank and obtain a personal loan at a much lower cost.
  
  

Lower Rates

• Consolidation loans, or loans that offer significantly lower interest rates than a current debt, can help lower your monthly payments or shorten the life of your debt. Borrowing just enough to pay off another-higher interest debt can save thousands of dollars over the life of the loan.
  
  

Starting a Business

• Although it is a risky proposition in many cases, some people are able to make much better lives for themselves and their families by opening their own businesses. However, most businesses cost more to get off the ground than the owner has on hand.
  
  Borrowing money for this purpose is good as long as there has been adequate market research done, a solid business plan is in place and the owner is willing to put in whatever work is necessary to see the business grow early on. Business loans are typically issued by banks, credit unions, family or friends and government agencies, according to The Globe and Mail website.