Wednesday, August 16, 2023 / by Jiselle Bersabe
Liabilities that deplete your financial resources without creating an income stream are referred to as bad debt. Essentially, it is debt that has no long-term worth or usefulness. Car loans, credit card debt, and expenses associated with unhealthy behaviors are common instances of bad debt. The issue with bad debt is that it gradually destroys your net worth as you continue to make payments while receiving no significant return on your investment.
Good debt, on the other hand, is when you borrow money with the goal of generating an investment that generates income or increases in value over time. It involves borrowing money to purchase assets that have the potential to enhance your financial status. Real estate investments are often considered as good debt since they can generate consistent cash flow throug. ...