Kia ora Tracey – this is a big question! There is no clean answer to this. It is personal choice based on you as an individual. No-one should sway you either way. But there are things you can consider to help your thinking:
1. The cost of borrowing – the OCR, and more importantly the yield curve and the cost of money that banks pay on the wholesale markets is tracking all very very low. Central banks are rolling out quantitative easing programmes right now. The net result of this is that the cost of borrowing is going to stay dirt cheap for a long long time.
2. The risk of repayment – regardless of how cheap money is to borrow, every loan carries the cost of you being able to repay interest (and principle). Which is dependent on you having the cash to repay. You need to establish your comfort levels on this. You could run some simple scenarios on excel to play out what you can afford.
3. Blurring the lines between personal and business – many people advise to keep things separate. Not only is it cleaner, but it also stops anxiety, pain, fall out creeping into personal lives (impacting loved ones). There are lots of disaster stories here. THAT SAID, there are also lots of courageous stories of people’s success being hinged on them doing everything it takes to keep things going. This works well when people are really good at strategically pivoting and innovating. And this ultimately depends on the type of person you are.
I hope this helps. Go well