3 ways to finance your next large purchase  without going into debt

3 ways to finance your next large purchase without going into debt3 ways to finance your next large purchase without going into debtWe all have larger than life dreams that seem completely impossible. That all-inclusive cruise. A shiny, new Mercedes. The diamond Tiffany Co. necklace youve had your eye on for forever.Whether you want a gorgeous set of Restoration Hardware furniture or youre dying to get your hands on a designer purse, the unfortunate reality is that these things cost money a lot of money.Follow Ladders on FlipboardFollow Ladders magazines on Flipboard covering Happiness, Productivity, Job Satisfaction, Neuroscience, and moreDoes that mean theyre unattainable? No. You dont need to be a member of the elite rich to own luxurious items - you just need to know how to finance them responsibly. By no means do we encourage you to pull out the plastic and start swiping until your hearts content thats a sure-fire way to find yourself drowning in debt.But if you have a big pu rchase ahead of you - out of desire or necessity - there are three ways you can turn your farfetched goals into a tangible reality. Heres how.1. Shop for Interest RatesThe golden rule for staying out of debt? Finance as little as possible. Cash is always king but when thats notlage an option, youll need to afford your purchase with a loan or line of leistungspunkt. Do your best not to overspend outside your means if you cant pay off your statement balance in full, you should avoid making the purchase.Always, always shop interest rates to find the lowest APR possible high-interest rates can make your purchase incredibly more expensive down the road. The key to obtaining a low APR is by having a strong credit history. If your score is a little low, you should work on improving your credit before considering any large purchases.Tip As you shop for interest rates, potential lenders will want to pull your credit report which results in a hard inquiry that might negatively impact your s core. Try to pull your own report instead with a soft inquiry that ensures your score stays nice and high.2. Tap into EquityRather than borrowing money from a creditor, have you thought about tapping into your home equity? Both home equity loans (sometimes called second mortgages) and home equity line of credit (HELOC) allow you to borrow money against the equity youve built in your home with interest charged on the proceeds.A home equity loan is a lump-sum payment, which is typically used to finance a big project such as installing a pool.A HELOC, on the other hand, is a revolving line of credit that you can use in small chunks (for home improvement projects) or large chunks (to pay for a wedding or college tuition).A HELOC can also be used as a resource to settle mounting debts and work your way back to financial freedom.Tip Not all loans are created equal, which is especially true when it comes to borrowing against equity. Terms, fees, and interest rates will vary dramatically ba sed on lender and location.For example, a New Hampshire home equity line of credit might have more competitive rates than a similar lenders offering right across the border in Salem, MA.Remember, do your research and always compare loan structures to make sure you find the fairest financing possible.3. Save Instead of BorrowThis option doesnt apply to circumstances in which you need funds to afford a big, immediate expense, such as unexpected medical costs.When life throws you a curve ball and you need money immediately, sometimes your best bet is to turn to crowd-funding sites like GoFundMe and ask for donations toward Fidos urgent vet bill.But apart from emergency situations, you should always prioritize saving money over borrowing money.Playing the long, waiting game isnt easy - especially when you need that Caribbean vacation like yesterday. Be patient Good things come to those who wait (and save).Its true that interest rates on savings accounts are relatively low, but any int erest coming in is much better than interest going out. Paying in cash helps to stay out of debt, positiv you can often negotiate a better price with the cash up front bargaining tool (as I said, cash is king).Tax season is just around the corner can you wait for your tax return before making your purchase?Tip Budgeting and saving money can be quite a challenge, especially when youre feeling that impatient, must have it now itch.Make life easier with a savings app like Qapital that can automatically round up your debit card purchases to the nearest dollar and but the spare change into a savings account.It simplifies saving, plus youll probably be amazed at how quickly a few cents here and there can add upYou can have that 53 plasma flat screen - you just need to know how to responsibly purchase your big-ticket items by being wise with your money.This article first appeared on Perfection Hangover. This post may contain affiliate links. Click here to read my full disclosure.You might also enjoyNew neuroscience reveals 4 rituals that will make you happyStrangers know your social class in the first seven words you say, study finds10 lessons from Benjamin Franklins daily schedule that will double your productivityThe worst mistakes you can make in an interview, according to 12 CEOs10 habits of mentally strong people