Asked by Anonymous
Asked on 21 Nov 2019
Anyone has had experience with this and can share more on the pros and cons?
Not sure why this is tagged "CPF"
Short answer: Any line of credit is borrowing; if you are borrowing to pay for current period spend then you should consider whether you are living within your means or not.
Long answer: borrowing can be useful to purchase large assets (eg car, home) where the utility immediately outweighs the financing cost. Also borrowing for investment purpose may be appropriate - this is known as leveraging and does increase risk so must be approached carefully. Outside these reasons, it is not so advisable to be borrowing significant sums.