Is DEBT really a solution?

[wealthyhead]

---

A debt is always a debt... if you're trying to solve your problem through debt. and make it a cycle... bayad-utang, bayad-utang, bayad-utang.... then you're not paying your debt... you're paying the interest! kalabad ani oi!

exactly! and most people doesn't understand the real effect of interests...

to have some kind of comparison.. try comparing your debt interests and your savings interests..

find out kung unsa ta ka alkansi

[neil11]

Debt can be a problem at the same time a solution...

It's just how u play it...

there are two types of debts..a good debt and a bad debt..good debt if you use it for investment..bad debt if you use it to satisfy the greediness of acquiring liabilities within us..
example..gokongwei loaned a money from chinabank to start his industry..this is a good debt..because its for an investment to an asset...it puts money in your pocket..
bad debt if you loan a money from the bank to buy a house coz a house is considered a liability..it takes money out of our pocket due to taxes and stuffs...

very nice thread wealthyhead

[hacxcena]

If we can avoid the debt mas maau gyud. But it's better to have a debt for investment lang gyud ayaw buy og liabilities but most filipino samot na employees are always doing this thing. Loan then buy a liabilities.

[wealthyhead]

If we can avoid the debt mas maau gyud. But it's better to have a debt for investment lang gyud ayaw buy og liabilities but most filipino samot na employees are always doing this thing. Loan then buy a liabilities.

ya, very good point, and most people.. maybe around 80%, use debt just to buy "stuffs" - liabilities.

especially using their credit cards... So I guess most existing debts now are "bad debts"

[JGM]

Depends if you really need the money for emergency use.

[wealthyhead]

Depends if you really need the money for emergency use.

ya, that's how the credit card agents sell it to us... to use it for "emergency" purposes..

but what is really happening? most credit card holders doesn't just use it for emergencies.. right?

So, for emergencies - create ur emergency funds(3 - 6 months of your income).

[neil11]

ya, that's how the credit card agents sell it to us... to use it for "emergency" purposes..

but what is really happening? most credit card holders doesn't just use it for emergencies.. right?

So, for emergencies - create ur emergency funds(3 - 6 months of your income).

i totally agree with you weathyhead

[darkcrux]

Bad debts are problems. They are financial wounds. And wounds are dangerous. ^__^ To eliminate bad debts, stop the bleeding first (stop borrowing) then ensure proper protection and emergency funds to prevent more debts.

[wealthyhead]

Bad debts are problems. They are financial wounds. And wounds are dangerous. ^__^ To eliminate bad debts, stop the bleeding first (stop borrowing) then ensure proper protection and emergency funds to prevent more debts.

exactly ! stop borrowing money - very good advice

[darkcrux]

Yes... and regarding debt/loans/consignment.. SOMEONE also said that it's a problem, not a solution.

"The rich rules over poor, and the borrower is slave to the lender." - Proverbs 22:7

"He who is surety for a stranger will suffer, But one who hates being surety is secure." - Proverbs 11:15
(about cosigning a loan)

Proverbs 6:1-11 talks about getting out of debt.

and there are plenty more sound advices from HIS manual. ^__^