Heard yesterday that Kiyosaki distinguishes between good and bad debt. I doubt that I will agree that there is any such thing as good debt, but for the record, does anyone know what he means by the term?
-HW "Skip" Weldon Columbia, SC
I don't know what Kiyosaki specifically meant by it, but debt to buy an *appreciating* asset (home, human capital (i.e. training, college, etc.)) is often considered "good" debt, as opposed to debt used to buy depreciating assets (cars, consumer electronics) or outright consumables (eating out, fancy vacations, etc.) is often considered "bad".
In one example, he offers a credit card with $2000 spent to impress a fellow student (bad debt). Alternately, the same guy buys a pickup truck and uses it working with the local fire department, who, of course "pays him promptly". Remember, he's a big advocate of real estate as well, so debt to leverage return is what he'd consider "good". I'll generalize to say any debt that is used for income producing assets may (depending on return) be good. [I am not advocating the position, just summarizing my take on Kiyosaki's]
Time to recall the Robert Allen best seller, 1983's "Creating Wealth", and "No Money Down".
JOE
I can't believe I've reduced myself to quoting Kiyosaki, but just for fun:
from
-Will
BeanSmart website is not affiliated with any of the manufacturers or service providers discussed here. All logos and trade names are the property of their respective owners.