Hi there! I live on the gulf coast and much of what I owned was destroyed by Hurricane Harvey. Things were rough for a while, but with help from FEMA and my employer I've landed on my feet. I was offered a $20,000 loan by the small business administration, but I don't need all that money to replace my things. I'm living in a cheap place now and have few expenses, so I'll be able to save enough to furnish my place once it's rebuilt. I'm pretty debt-averse, but I would only need to beat 1.7% to make money here. I'm leaning towards rejecting the loan, but I want to know if I'm throwing away an opportunity to make money. If I were to invest it, I would probably put it in an index fund and not touch it until I have to put a down payment on a house, send any future kids I might have to college, or until I retire. The terms of the loan were ~ $20,000, 30 years, fixed 1.7% interest rate, monthly payment of $77. I'm in my early 20s and have a stable job where I make ~ 27,000 per year with good benefits. My employer is paying for me to earn a graduate degree, which will significantly increase my earning potential after 2020. I have no debt currently. Thanks guys!
EDIT: Some have said that taking this loan would be unethical. I appreciate people bringing that up; I don't want to do something that is inherently wrong. To provide some more context, the damages to my property were assessed at $20,000 +. I could use the money to replace all of my furniture and items with new ones, but I think that I can spent far less than that and refurnish my place with things I find on Craigslist. I have a little money saved up that I could use for this purpose, leaving the bulk of this potential loan money usable for investing. Does that change the ethical assessment?
Submitted October 12, 2017 at 10:04AM by probatocephalus http://ift.tt/2kMXwZJ
