The word "debt" can arouse anxiety in many people, and the idea of carrying a debt or loan is often viewed in a negative light. However, there are several debts that, if chosen and utilized correctly, will greatly improve the quality of life for the individual emotionally, socially, and financially. Here are four types of good debt that may provide these benefits.
Higher education has countless benefits: potential for higher income, increased satisfaction of life, development of a skill, and the opportunity to grow socially. But, higher education is becoming more expensive each year, and student loans are increasing with tuition. Student loans have become a source of worry for many young adults who do not have any assets or little income to pay back a debt ranging in the tens of thousands.
However, if the debt is going to increase your livelihood in the future, given the amount borrowed in comparison to the average income you're likely to earn after graduation, then the loan serves the purpose for which it was intended. When this time comes, student loans are there to help you. Take the time to compare different options and choose the right student loan for your needs.
Ownership of property provides a plethora of benefits for an individual's financial well-being. In order to own property, many individuals take out a mortgage loan. It is incredibly rare to afford any piece of property upfront at face value. Mortgage loans, and thus the eventual ownership of a property, has the financial benefits of creating equity, assets, and an increase in net worth.
Interest rates of mortgages typically range from 3 to 6 percent and, depending on the location, many mortgages can actually be lower than the average rent for equivalent property. Plus, unlike renters, homeowners are gaining equity in property that can help with financial stability.
The saying goes, "If you don't have your health, you don't have anything," and that wholly applies here. Medical bills can be expensive, but the gain from taking on medical debt is immeasurable. Overall health and well-being is not something to put on the back burner, and most health care and insurance companies have plenty of payment options to accommodate a variety of economic needs, so you are able to pay off your medical bills over an allotted time period.
Owning an automobile can open doors for a variety of people; from students to professionals to entrepreneurs, owning an automobile maximizes the opportunity for travel. For the young professional, owning an automobile can result in a quicker return on the loan due to the increased opportunity for job capabilities.
For example, if you have the ability to travel for a job opportunity, then you do not have to limit yourself based on self-transportation. For the entrepreneur, it may play a significant role in the promotion of a new business; an automobile will allow you to access your clients and network with much more ease and time efficiency than without a car.
Most debt is a weight around your neck, but the above debt can be a help and better your station in life. It's all about weighing the pros and cons and making the best decision for you.
Student Loans
Higher education has countless benefits: potential for higher income, increased satisfaction of life, development of a skill, and the opportunity to grow socially. But, higher education is becoming more expensive each year, and student loans are increasing with tuition. Student loans have become a source of worry for many young adults who do not have any assets or little income to pay back a debt ranging in the tens of thousands.
However, if the debt is going to increase your livelihood in the future, given the amount borrowed in comparison to the average income you're likely to earn after graduation, then the loan serves the purpose for which it was intended. When this time comes, student loans are there to help you. Take the time to compare different options and choose the right student loan for your needs.
Mortgage Loans
Ownership of property provides a plethora of benefits for an individual's financial well-being. In order to own property, many individuals take out a mortgage loan. It is incredibly rare to afford any piece of property upfront at face value. Mortgage loans, and thus the eventual ownership of a property, has the financial benefits of creating equity, assets, and an increase in net worth.
Interest rates of mortgages typically range from 3 to 6 percent and, depending on the location, many mortgages can actually be lower than the average rent for equivalent property. Plus, unlike renters, homeowners are gaining equity in property that can help with financial stability.
Medical Debt
Medical Debt
The saying goes, "If you don't have your health, you don't have anything," and that wholly applies here. Medical bills can be expensive, but the gain from taking on medical debt is immeasurable. Overall health and well-being is not something to put on the back burner, and most health care and insurance companies have plenty of payment options to accommodate a variety of economic needs, so you are able to pay off your medical bills over an allotted time period.
Auto Loans
Owning an automobile can open doors for a variety of people; from students to professionals to entrepreneurs, owning an automobile maximizes the opportunity for travel. For the young professional, owning an automobile can result in a quicker return on the loan due to the increased opportunity for job capabilities.
For example, if you have the ability to travel for a job opportunity, then you do not have to limit yourself based on self-transportation. For the entrepreneur, it may play a significant role in the promotion of a new business; an automobile will allow you to access your clients and network with much more ease and time efficiency than without a car.
Most debt is a weight around your neck, but the above debt can be a help and better your station in life. It's all about weighing the pros and cons and making the best decision for you.
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