Good Debt vs. Bad debt

Aug 27th 2010 at 2:20 AM

You probably heard that debt is a bad thing. This is true, it's not very good to have debt. However, in some situation debt can be very good.

There is good debt and bad debt. The bad debt is the debt that takes money from your pocket. If you use debt to buy a personal house that requires high maintenance this is bad debt because it takes money out of your pocket. If you use credit to buy a personal car that requires expenses for fuel, insurance and maintenance, this is also bad debt..

The debt you use to buy a liability is bad debt, because it takes money out of your pocket.

If instead of buying a big house, you buy a greenhouse that produces vegetables that you may sell, it means you bought an asset. If you buy a car that you use for taxi, this is also an asset.

Each time you use debt to buy an asset, it is good debt because it puts money into your pocket.

Watch the video bellow and learn from Robert Kiyosaki how debt can be good or bad!

Go to for more related articles or visit for more videos with Robert Kiyosaki.

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