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Originally Posted by photon
Debt is good. But you need to read the rest of my statement... Could be summed up as "Good debt is good."  Debt is only good if that debt is working for you in some way. Debt should be offset by assets. an iPod or consumer crap aren't assets; they don't increase (or maintian) their value and they don't earn you income.
Most people don't look at their lives as a balance sheet, and they should.
But I agree, you have to be disciplined and ensure that you balance between saving for the future and living for now. With our stuff most of what we earn goes back into investing (saving for the future), but we always make sure to pay ourselves something; some sort of reward for good behaviour. |
I know what you're saying and you're right. Some people are able to make it work, but MOST won't. That's what I was getting at and even then no debt is better that "good debt"
I have seen 4 couples in the last 2-3 years that had refinanced their houses to get some extra cash to invest. All 4 spent that money on consumer goods and all would be in trouble if their house went down in price or mortgages went up (which usually goes hand in hand). It's really not that long a trip to go from equity to being in red. People need to be really careful when investing with borrowed money when their home is collateral.
