Why would anyone get a loan in Switzerland?

With the high Swiss salaries and good opportunities to save, I can't really understand why personal loans would be a big business here. What do people use loans for?

Greetings,

Due to the high cost of Swiss property, most home buyers in Switzerland finance home purchases by mortgaging their properties in exchange for home loans.

Financing cars is the primary reason for people getting personal loans. According to the Swiss Federal Statistical Office, these are the most common reasons for residents getting personal loans:

1. Vehicles (cars, motorcycles): Around 20% of personal loans, mostly in the form of leases, are used to finance vehicles.

2. Interior decor (including furniture): More than 6% of personal loans are used for this purpose.

3. Payment of debts and bills

4. Equipment for private use

5. Financial difficulties

6. Vacations and time off

7. Financing a new business

8. Healthcare costs

9. Continuing education

10. Children's education

Verdict: There are many different reasons why individuals borrow money. While it is almost always better to pay for goods and services up front in cash, loans provide flexibility by allowing you to take advantage of financial opportunities when you do not have enough capital on hand.

However, it is important that borrowers carefully compare the cost of loans and avoid borrowing money which they cannot easily afford to repay by the due date.

Best regards from Moneyguru

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