Try not to get into debt at all in your life and if you are already in debt, pay it off!
When you are in debt, you owe someone money, you bought something today with money you don’t have today so in return they charge you interest.
You now have to pay back this interest with money that you earn while exchanging your finite time at your job most likely.
If you have a lot of debt you might be charged $100’s or even $1000s a week in interest, this money will have to be paid back with your hard earned after tax dollars, your finite time.
Pay down any personal debt such as your mortgage, personal loans, credit cards etc. quickly to save yourself interest cost and time.
Paying down high interest debt is the best investment because if you pay off a credit loan charging your 20% that’s like getting a 20% return on an investment which is a good return! That’s what warren buffet achieves in his investment fund. Some debts are more than that, 30%, and you can get that return just by simply paying down that debt. Remember, paying down debt is investing in reverse.
And once you have paid off personal debt don’t go into it again. I was listening to a podcast by Dave Ramsey who is a really good financial advisor by the way and he was saying once he paid off his mortgage he didn’t take on a mortgage again! If he wanted a better house he waited until he saved more to buy it.
Don’t get into debt, if you are in debt make it your goal to pay it off.
I am not a qualified financial adviser and the information in this article is general only before making a financial decision you should speak to a qualified professional.
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