Category Archives: Money

Tips when considering equipment finance

Every business needs equipment to function. Data today is digitised, with information from clients stored in servers and hard drives, not folders or papers. We also use equipment just to complete our tasks: whether we’re farmworkers or cutting edge designers. Regardless of what we do or who we are, we do require equipment – but that can be hard to come by, especially given how expensive everything is these days. One solution is to attempt equipment finance, letting us receive the necessary funds while paying back in installments.

What is equipment finance?

As the Business Dictionary defines it, equipment finance is: “Any method of extending capital to businesses for the purpose of acquiring equipment.” The options vary between finance houses and the relationship with the business.

Why choose equipment finance?

We can see the advantages here. Indeed, some experts point out that even if we have the necessary cash to pay for costly equipment, it’s still wise to consider equipment finance. For example, while we might be able to pay for an expensive piece of equipment right now, this means an immediate, massive hit to our cashflow.

This also doesn’t take into account maintenance or emergency issues, further requiring dipping into our cash reserves. In fact, we might not have enough after purchasing to sort out emergencies, so we might need a loan anyway.

Instead, going for financing options means we aren’t hit by massive deductions and can manage repayments in a way that doesn’t jeopardise our cashflow.

But, like all forms of financing, we should be considerate about precisely what is meant by this transaction. Let’s consider two pertinent aspects when it comes to equipment finance.


One of the first questions we must ask is precisely what the financing will be for. All lenders will want to know this, too, of course – since they don’t just want to give the money to just anyone. Obviously, we want equipment that can aid us in obtaining profits. We must therefore carefully calculate the expenses for the equipment against how much it will return. We don’t want to get equipment that ends up costing more and making us less profit, after all. This immediately would disqualify us from consideration.


We must find a lender who can maintain an open line of communication, so both sides know precisely the details of the transaction. No one wants to be misinformed when it comes to money. This also means we must thoroughly understand the terms of any agreement reached.

By thoroughly engaging with calculation and communication, we will have a better basis to engage any transaction about financing for equipment. Ideally, this will lead to profitable business and a healthy relationship with a competent lender.

(Picture credit: PublicDomainPictures / Pixabay

What gets people to buy expensive things?

Most people are not rich, yet most of us still want a home and cars. The question is what motivates people to acquire items, usually beyond their means? Expensive doesn’t necessarily mean luxurious: After all, cars are necessary for travel and homes are needed if we want somewhere to live. Indeed, for most of us, we’re not talking about Ferraris or big mansions. Yet, even the least expensive will set us back somewhat.

What then drives us to get them?

Necessity and indulgence

Too often when discussing issues of why people buy expensive items, we assume that the items are not important. But as we noted, homes and cars are often necessities. This doesn’t negate that cars and homes can be luxuries, as any unbelievably large mansion or someone’s third or fourth car demonstrates. No one needs houses so large they take up nearly a whole field. And we can’t drive more than one car at a time.

Yet, rich people will and do indulge in such excess because they can. And, unfortunately, wealth is often tied to a sense of fulfillment according to researchers. This is so potent it leads even those who can’t afford luxury items to acquire them through credit. Writing in the Journal of Consumer Research, Marsha L. Richins concluded:

“Materialists are more likely to overspend and have credit problems, possibly because they believe that acquisitions will increase their happiness and change their lives in meaningful ways.”

This mindset doesn’t come from nowhere. Other researchers have shown the mere desire for items can be sufficient fulfilment. But again, this only shows us luxury goods not necessary ones.

What is necessary?

How then do we judge necessity when there is a heavy price tag? A good way is to consider a common, but fairly expensive item: cars. According to recent data, used BMW 1 Series from 2012 was the fastest selling car in the UK, in August. The car has proved reliable, safe and fairly recent. However, it’s not so recent that it’s priced at an exorbitant amount but not so old the technology is out of date.

Consumers are not looking for cars with parts that are difficult to acquire. Considering how quickly car technology advances, people also want safety as priority and fewer cars are safer than BMWs. The point is, cars are a necessity and consumers can make smart decisions to acquire the best one – without it being seen as an indulgence. Indeed, though it is a BMW, no one’s first thought when hearing about a used 2012 car is that it is a luxury vehicle.

The contrast here is that we are putting necessity above material desire, but still able to compromise for both. This is possible on all manner of purchasing choices. Everyone – whether seller or buyer – must keep this in mind as we enter an increasingly difficult financial future.