[BeemerBMW]

I'm currently trying to figure up how much I would need in a loan.

However, i'm not sure about the estimation. Should I estimate really high? (so that I will have plenty) Or should I estimate above average? (so that I will have extra) Or should I estimate how much I think I will spend? (and expect that nothing should go wrong or come up)

[BeemerBMW]

Also, how long should the loan last for? Should I make sure I have enough for 6 months? A year? Year and a half? Two years?

[BeemerBMW]

Double post.

[BeemerBMW]

Bump.......

[akula]

Originally Posted by BeemerBMW

I'm currently trying to figure up how much I would need in a loan.

However, i'm not sure about the estimation. Should I estimate really high? (so that I will have plenty) Or should I estimate above average? (so that I will have extra) Or should I estimate how much I think I will spend? (and expect that nothing should go wrong or come up)

No, how much money you need is not the way to estimate how much you should borrow.

The only way loans are granted by banks is based on how much you can afford to borrow.

For example: you have a lump sum of 1k, and you can afford to make repayments of $100, the interest rate is 5%p.a. and you wanna repay the loan within 5 years. You plug these numbers in to a calculator similar to this one, and it tell you how much you can afford to borrow.

With borrowing money, it's not how much money you need, it's how much you can afford to borrow.

[BeemerBMW]

I can afford to borrow much more than what I need, thus the reason I asked.

[MiserAd]

85% of all small businesses fail due to lack of working capital. I would always have more in the reserves for unforeseen circumstances.