Our house is paid for but it needs some large item maintenance done and some decorating. We have 2 choices...we use our savings or we go into debt for a loan. Which is wiser? We don't like debt but I feel it's more important to have cash available if needed. Another consideration is we are living on 1 income because I stay at home with our 2 little ones. I'm going to bring it up to my hubby but I know he's going to try avoiding a loan. TIA
Just MHO here: With low interest rates, I would lean toward a loan. You should have several months expense money available should the unexpected job loss or expense occur.
That said, I would not choose to go into debt for decorating or new furniture. If your home requires needed maintenance, (that would cost you more later if neglected) and that would possibly save you money (or greatly increase value) if done now, that is a different story.
I would do lots of "homework" and shop wisely for any upgrades.
Definitely a low interest rate line of credit. As Conrad stated - forget borrowing money because you feel the need to redecorate but use other people's money for needed substantial maintenance issues. A new roof, a new high efficiency heat pump, high efficiency water heater, etc.
Unless you have a tremendous amount of money in the bank - don't use your savings. For decorating - use cash flow.
Financial experts have long said that you should have a minimum of six (now eight) months expenses in savings so I would suggest a low interest loan unless your savings exceed that amount. But, I would only borrow money for absolutely ESSENTIAL maintenance expenditures ~ not a penny for updating or decorating!
We, too, dislike debt but I would feel even more insecure not having savings in case of an emergency which, by their very nature, occur just when you are not expecting them!
Perhaps you could "tweak" your budget to cut-back in some areas and set aside what you are able to save in those areas into a special fund for the extras? Good luck....
What kind of maintenance repairs..remember to check first ther are rebates and incetives from utility companies...check in your area..and know costs factors before obtaining a loan. Try to avoid second mortgage.