Debt can be basically classified into two categories: productive debt and destructive debt
Productive debt means the money you borrowed for investment, buying your own home, etc.
Destructive debt means the money you borrowed for buying liabilities, a car loan for example, or credit card bills, high-interest personal loans, etc. Any outstanding loan that you have not been able to pay off is also destructive debt. Destructive debt is also called bad debt.
The road to financial success begins by paying off your destructive debt or bad debt.
First of all, identify which is your productive debt and which is destructive debt. Then make a list of all destructive debts. Start by paying off high-interest debt. Don’t think about any other purchase until you pay back your bad debts.
Saving is important because when you have saved you can not only use it when needed but also use it to build investments, however, as long as you have bad debt you cannot save. Once you pay bad debt then think about investing in house or stock.
One of the major reasons why you can’t build a fortune is because of your debt. Before doing anything, first pay your debt. Even if you had borrowed money to start a business, you should focus on paying your debt first.
Productive debt means the money you borrowed for investment, buying your own home, etc.
Destructive debt means the money you borrowed for buying liabilities, a car loan for example, or credit card bills, high-interest personal loans, etc. Any outstanding loan that you have not been able to pay off is also destructive debt. Destructive debt is also called bad debt.
The road to financial success begins by paying off your destructive debt or bad debt.
First of all, identify which is your productive debt and which is destructive debt. Then make a list of all destructive debts. Start by paying off high-interest debt. Don’t think about any other purchase until you pay back your bad debts.
Saving is important because when you have saved you can not only use it when needed but also use it to build investments, however, as long as you have bad debt you cannot save. Once you pay bad debt then think about investing in house or stock.
One of the major reasons why you can’t build a fortune is because of your debt. Before doing anything, first pay your debt. Even if you had borrowed money to start a business, you should focus on paying your debt first.
