Good debt vs. Bad debt

Not all debts (borrowed) are bad. There are GOOD DEBTS and BAD DEBT. Clearing your debts will help you manage your finances better.

✌️ GOOD DEBT is a debt when you borrow money to invest in something, it will help you make money (for example, investment in education, home and business...). The profit you earn must be higher than the amount you have to pay.

✌️ BAD DEBT is a debt when you borrow to PAY on those who will lose value (for example, buying cars, credit cards, consumer loans ...). You will not only have to pay INTEREST RATE, you will also lose money when the VALUE of those items decreases.

🍄 Please note, if you have to borrow to spend, make sure you are buying Assets and not Consumers. And even for good debts, you should not be too confident. A thorough review before making any financial decisions will help you reduce your risk.