Good Debt or Bad Debt?

If you’re too comfortable and aren’t ‘all in’ with your time and money, the chances are that you may not be taking enough action.

It’s so easy to just let the days go by and not do enough.

If you work on your own a lot then it’s way too easy! I know from personal experience.

I’m not saying you need to invest every penny you have or give up other sources of income before you’re ready because that might not be the best motivator for you.

You can develop a side business with the internet and still have lots of time to do other things if you’re organised.

Different people respond better to different levels of financial commitment. Some people just freeze when they have any debt and don’t do well at all.

But then of course it also depends what kind of debt it is and how you view it. When I got educated and clear on the difference between good and bad debt I found it a lot easier and less stressful to manage my finances.

If you are investing to grow your business, develop your skills etc. then I see that as using credit in a smart way. Sofas, televisions, shoes and holidays don’t fall into that category! They are definitely bad debt so beware of using easy credit for things that won’t give you a financial return.

Credit cards can be a wonderful tool for developing yourself and your business when used sensibly, so don’t cut them up too soon! Keep one or two which give the lowest rates of interest, to use for your business investments and emergencies and either pay them off in full each month or have a plan for paying them off in a specific time frame.

The truth is that when you invest and pay for information or training you will value it a lot more than if it’s free and in turn you take more action which is why I invest in training programmes and information products and why I recommend that others do too.

When you have ‘good debt’ that needs paying off it can act as a reminder to keep producing and stay committed to your plan.

If you have bad debt then make a plan to pay it off as soon as possible and discipline yourself not to use credit cards for things that give no return in the future because bad debt can weigh you down and puts you in a desperate mindset which is not good for business!

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