What one person considers a good reason to borrow money may not register with another. However, certain types of purchasing situations and financing opportunities provide stronger reasoning for taking on a debt.
Buying a House
One of the most common, and worthwhile, reasons to borrow money is for a home mortgage. Experts debated the merits of housing as an investment in a June 2013 article in The Wall Street Journal. A mortgage loan with reasonable interest rates has a few key advantages. For one thing, most people can't pay cash for a home so borrowing is the only option to become a homeowner. Also, when you buy a house, the money you pay on the debt contributes to equity build-up. Finally, the interest paid for home loans is tax-deductible.
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Growing or Expanding a Business
If you have a business idea that enables you to significantly expand your income capabilities, you may actually suffer an opportunity cost by not borrowing, according to a December 2014 Entrepreneur article. Borrowing money that can lead to a hefty return on investment is sensible relative to avoiding debt and losing out on the money-making opportunity. For example, businesses might borrow money to finance growth initiatives that can lead to greater sales and profits -- something they would miss out on without access to loans.
Building Discipline and Credit
Entrepreneur suggests that taking on debt is one of the best strategies to develop discipline in using debt. Parents of teens or young adults may use a student credit card or secured card to teach their kids about debt, including how monthly payments work. Also, you need to use credit to build a credit history. Therefore, taking on a small amount of debt and paying it off responsibly enables teens and young adults to establish positive credit early.
Taking Advantage of an Offer
In some cases, the benefits of the financing offer itself contribute to the justification for debt. Car dealers and credit card companies routinely promote zero percent financing opportunities to attract borrowers. Home renovation or project-based solution providers promote zero percent deals as well. You normally need strong credit to qualify for these offers. If you qualify and can make monthly payments with discipline, borrowing and preserving cash is a practical move, according to AutoTrader.