Factors to consider when going in for a loan as a government worker

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Factors to consider when going in for a loan as a government worker

A loan is not a bad thing as many people perceive them. A government worker who relies solely on salary should be a fan of taking loans. However, before one takes a loan, there are certain factors to consider to avoid financial crippling. Some of these are as follows;


Most financial companies seek to milk workers who take loans from them. Before you make a decision to go in for a loan from any financial institution or company, check their records and if possible, find out from friends about that company. This will help you ascertain who they really are. Some companies decide to continue deduction after deductions of the loan are complete. Mind you, this is your payslip and it’s very tough to eliminate deduction from it especially in the case of the Ghanaian worker. If possible, bank loans and mutual fund loans will be suitable.


Have you ever heard of ‘On trees loans”?. There are financial companies who hang or paste their advertisement on trees for people to contact them for loans. Such companies come with sugary interest rates with hidden charges. These hidden charges, in the end, shoot the interest rate on your payslip and it is going to hunt you forever. Avoid ‘on tree loans’ if possible. The best way to avoid them is to see your bank for a loan that has less interest rate. Also, this will help you keep your payslip clean.


The time frame used in deducting the loan also counts. To go in for a loan, make sure you have meaningful affordability. This will help you pay off the loan in no time because the money to be deducted every month will be huge but won’t have any negative impact on you. Let’s say you have a net income of GH1500 every month and GH400 or GH450 is deducted every month, although it will affect you but not all that much. However, this will help reduce the number of months or years used for the deduction.

As you now know the factor to consider before taking a loan, let’s look at certain things you can invest the money into. A loan is not for fun or chilling- It is for investment. Any person who takes a loan for enjoyment lives to regret later.

The loan can be invested in ventures such as farming (animal or crop farming), setting up a store, buying a tricycle popularly known as “Mahama Camboo” or anything that will bring a daily, weekly, or monthly extra income.

Moreover, monies accrued through loans can be invested into building or buying of land. These are appreciative assets that do not lose value easily. For example, a plot of land bought around GH4000 in 2014 will be sold at a higher price in 2021. What if you do not sell it and decide to use it for your own project? it will interest you to know that majority of the successful people you see today started with loans and they have made it. They used it judiciously.

Factors to consider when going in for a loan as a government worker

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