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Living debt-free is a great idea if you are middle-income in middle-America and you intend to stay that way. Under those circumstances you will definitely be happier and have more money if you live debt free. However, if you are a business owner or if you aspire to wealth, debt is a necessary reality of your life. Building wealth or growing a business requires leverage. Leveraging is using other people’s money to purchase assets while keeping all of the growth on the asset or enterprise.

Example: You buy a house for $100,000. You borrow $80,000. The value of the house grows to $210,000. You still owe only the $80,000 plus interest. That’s how you grow wealth. It works the same in business – borrow, buy product, sell at a profit and pay back what you borrowed. If you were to take on investment partners, they’d be entitled to a percentage on the growth. Leverage is better

.Poorly managed debt will cost you…

So, yes you need debt. What you

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Of late, economic bubbles that caused the economic recessionary cycles of 2007- 2010 have also severely affected the debt and credit industry. The reaction of the recession that came out against people and borrowing consumers left behind tattered credit reports, several brutal bankruptcies and freaked out foreclosures. Over the effect was not nice and brought about a negative atmosphere among lenders and borrowers. When the recessionary cycle commenced, the rate of unemployment and frequency of lay offs substantially shot up. The people who got fired had already borrowed several secured loans, unsecured loans and were using credit cards. The effect was that these people were not able to repay bills and loan installments on time. Deep in debt such borrowers often though of debt management programs as an alternative to get rid of debts. The pros and cons of debt management programs should however be considered before a person makes a choice. Full Post…