When is debt good?

July 10th, 2012 | Tags: , | No Comments »

When is debt good?

Not all debt is bad. An over indulgence in debt may strain our financial well being and can lead to sleepless nights but we can sometimes sleep a little better if we know that our debt is not villainous. Debt can be extremely bad when it is primarily consumption driven and used impulsively. However debt that builds future income bearing assets and invested appropriately to generate rising value either as a person through education to improve skills or asset quality. Good debt is also that which goes into building value through utility and  improving our performance and efficiency leading to increased income potential.