1/7/2009 3:05:59 AM

Debt is a problem for most Americans, and figuring out how to limit your dependency on borrowed funds is key, like using too many payday loans or racking up more credit card debt. There is a distinction, and not many are aware of it, between good debt, and bad debt. Good debt is when you make an investment with the money you borrow, that creates value that you can reap benefit, or profit from. A house or college educations are amongst the best examples. Bad debt is where the incurring of the debt does you no good in the end, such as credit cards or a brand new car. (New cars lose several thousand in value the second you drive off the lot.) Also, with good debt, the more you pay on it, the better it is for you. For instance, the more you've paid on your mortgage, is the more equity or portion of your home that you own. That property value appreciates over time, which means that you make more money when you sell your home. If you rent, that is an example of bad debt. Payday loans are to be used only if you really need them, and if you use them correctly, such as to stave off a late fee, disconnect fee, or overdraft charge, they are actually saving you money. You can read more in the article posted on this site: personalmoneystore.com/.../.

Tristen

1/20/2009 10:42:13 PM

i myself understand that sadly the way the economy is, alot of people are surviving with credit.  in my eyes the middle class is just starving.  Your not poor so you dont recieve any aid, but you dont make enough to save ahead for disaster.  It seems to me most middle class people are like us living paycheck to paycheck and when things happen they must resort to credit.  Its a bad never ending circle till you pay the card off you need it again.

shonna

6/18/2009 3:53:33 PM

Sadly, a lot of people still overspends too much even during these hard times.  Unless they can control their spending sprees, they would have no chance to have a better credit standing.

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