When Debt Is Good

Debt is the word that enrages financial philosophers. I myself keep advising everyone to clear up their debts before investing any penny. But is there good debt? Is there good debt that doesn't enrage the financial philosophers? Is there good debt that doesn't wipe out your income? Is there good debt that you can use to your advantage?

Source: debthelp.trustee.ca

In this post, you will learn when debt is good. And how debt is good if you use them according to this guide.

Specifically, you will learn:

• Is there really good debt?
• What is good debt?
• When debt is good?

Many, even the financially educated, live debt-free. It is certainly possible and a not-so-bad thing but when debt is good, it is best to become indebted.

Often times, you will want to make an investment but there won't be enough money for it. What should you do in such a situation? Should you let go? Or, should you take a loan to fulfill the requirements of the investment?

I will suggest you let the investment go. Unless, the investment can become an income source immediately or in the very near future. Then debt is good.

Let me give you an example. A popular annual festival is at hand and you know many people visit the place. In fact, the place gets so crowded that restaurants fail to serve everyone.

Being a businessman, you quickly realize you can make a good fortune out of this chaos. A property is on sale too. You inquire about the property and the owner asks a pretty fat amount for it.

You don't have enough money. But because you had read my blog, you quickly do the calculations and find out that your profit from buying the property will overweigh the mortgages. You buy the property on loan and are happily paying the annual interest. Happily because even after paying the interest, that property earns you enough to keep your smile on your face.

This is when debt is good. In shorter terms, debt is good when you use it to acquire an income source that overweighs the annual interest rate.