Question:   What do you consider a bad debt loan? We want to have children and it appears that adoption is our only choice. Can I take out a loan to pay for the adoption?

Answer:      While children are a blessing, debt is not. Therefore, I would not recommend seeking out a loan to pay for adoption expenses, or any other expenses for that matter.

Ideally, it’s always best to save the money upfront so that you can pay cash and avoid making payments.

If you already have a lot of debt, obtaining a loan and adding more debt to your household is not going to help in the least. In fact, it's typical bad debt management.

Getting a loan for something that is optional and can otherwise be planned for in advance is considered a bad debt loan. In the case of adoption, wouldn’t it be better to wait a year, pay for the expense of the adoption in cash and be able to invest the money that you would have to have paid in payments toward your new child’s education fund?

Besides, entities that are willing to loan money to those with a lot of debt will often have very high interest rates, making the total cost of the item much greater. This is especially true during a tough economic climate.

As much as your intentions are good, and should be admired, taking out a bad debt loan is not a good idea. If you have to take out a loan in order to pay for an adoption, then you may not be on solid financial ground to begin adding to your family.

No matter how much you and your partner may want a child, adopting one now will only add to your financial burdens. Children are expensive; they require food, clothing, a place to sleep, and much, much more. You will be caring for another human being, and taking out a loan to do so is not a good start.

In any situation, you should never pay on credit when you can pay with cash. Debt management programs reiterate that "debt only leads to more debt".

Seek out methods of lowering, or even eliminating, your existing debt before considering adoption. Free debt counseling does exist. Check out this free guide, A Must-Do List For People On A Debt Management Plan.

Obviously, bringing a child into the world and into your home is a very personal choice, one that every prospective mom or dad must make for his or her self. Trust your instincts knowing full well that a bad debt loan is something you should try to avoid whenever possible.

If you do choose to wait and save in order to pay cash for this large expense (uh, Blessing), you can then feel more at ease as you bring your child into a debt-free home. The extra money will allow you to happily give your child everything he or she needs without fear or worry from financial issues.

» Do I need debt management software? My spouse is the financially enlightened person in the marriage. I’m trying to be better with my money, but I’m struggling to be as good. How can I do better?
For some reason there always seems to be one spouse who is financially more disciplined that the other. Perhaps it’s all part of the whole “opposites attract” thing.

» The lottery is my debt settlement program! I’m feeling lucky! After I win the lottery, what should I do with the windfall of cash?
You should never, ever, rely on sheer luck as your plan for paying off your debt. The lottery is nothing more than a way for government to take in more of your hard earning money.

» I recently reported a stolen credit card, but just found out my spouse took it and didn’t tell me. I’m thinking about leaving the marriage, what should I do to protect myself?
The fact that you reported a stolen credit card will work in your favor because the bank will shut down the account the second they are notified.

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