When Is Debt OK? 4 Times It’s OK to Take on Debt

 

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The worst four-letter word in finance, especially since, let’s say, 2008 is “debt.”

Personal debt.

National debt.

Sovereign debt.

They all have nasty connotations.

But, is debt always bad, without exception?

I think there are a few wise ways to use debt as a tool, not as a weapon of mass self-destruction. Here are four reasons not to be afraid of debt.

Use Debt for Things That Increase in Value

One use for debt is to purchase major items that have a better chance to go up in value. For instance, technically a home will go up in value, so taking a mortgage out for a house is a good idea.

Now, a car probably isn’t a good idea for debt. The second you drive the car off the lot, you’re losing money. But, an $18,000 or so price tag is a pretty stiff bill to pay in one chunk. Here’s a compromise: take out a loan on your car, but double the payments, pay if off a few years early and then keep saving that amount for your next automobile purchase.

Use Debt in Emergencies

You should save for an emergency fund, but sometimes the emergency hits quicker than you thought, or hits harder than you thought. If that happens, debt is certainly an alternative. But remember, when you reach safer shores, those debt bills are the first ones to pay off.

Use Debt for Your Credit Record

Acquiring and dealing with debt responsibly is actually a positive. It improves your credit score and probably will give you better interest rate when you do need to use debt.

Sometimes You Have to Use It

Some purchases require a credit card is one example of this. Most rental car agencies won’t let you use a car unless you have one–same thing with hotels. As we discussed, some purchases are too big not to use other people’s money.

Essentially, debt is pretty difficult to avoid. But the key is to not make credit cards and loans as your primary way to make purchases. Consider other alternatives. Also, when you do use debt, make it your priority to pay off.

Related posts: Weekly Wisdom: Steering Your Personal Financial Decisions in Interesting TimesThis Winter: How To Make A Debt SnowballThe Power of a Debt Free LifeHow Your Thoughts Affect DebtHow Technology Can Improve Your Debt Score

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Top 5 Kindle Steals: Great eBooks for Business and Self-Improvement

Each month, you can get deals on Kindle books at Amazon.

Typically, Amazon prices the books at around $3.99, but some are a lot less. The books cover a range of subjects and topics, but usually they have a few titles in the business and self-improvement section, two subjects that this blog is concerned with.

Here are some good ones that I discovered in the list.

Check them out.

Make a Real Living as a Freelance Writer

By Jenna Glatzer

“Step-by-step instructions on how writers can earn top dollar writing for magazines are provided in this book. Secrets are revealed about what the high-paying magazines really want, how to build relationships with editors, how to ascertain which sections of a magazine are open to freelancers, what kinds of stories are in demand, what to do if a deadbeat publisher doesn’t pay up, how to market reprints, and how to become an expert in one’s chosen writing field. Basic terms like query, clips, and source sheet are defined for beginning writers, and tips on everything from coming up with an idea to pitching a syndicated column are also included.”

The Only Investment Guide You’ll Ever Need

By Andrew Tobias

“For more than thirty years, The Only Investment Guide You’ll Ever Need has been a favorite finance guide, earning the allegiance of more than a million readers across the United States. Now even more indispensable, this completely revised and updated edition will show readers how to use money to their best advantage in the wake of epochal change on Wall Street, no matter how much or how little they may have.”

Goals!

By Brian Tracy

“Based on more than 20 years of experience and 40 years of research, this book presents a completely updated and practical, proven strategy for creating and meeting goals that has been used by more than 1 million people already in its first edition.”

Switched on Selling

By Jerry V. Tiplitz

“Is your brain stuck in the OFF position? Are you switched-off for any part of the sales process-from making cold calls to answering questions, to asking for the order, to handling rejection? Switched-On Selling is a proven, leading-edge, mind-body technology that will immediately re-wire the default settings for all parts of the sales process to balance your brain for optimum success. It starts working as soon as you finish each chapter!”

The Day Wall Street Exploded

By Beverly Gage

“In The Day Wall Street Exploded, Beverly Gage tells the story of a once infamous but now largely forgotten terrorist attack. Based on thousands of pages of Bureau of Investigation reports, this historical detective saga traces the four-year hunt for the perpetrators, a worldwide effort that spread as far as Italy and the new Soviet nation.”

Related posts: Author! Author! Writing eBooks For Residual IncomeMove Your Own Damn Cheese: Five Business Book LiesDoes Your Lizard Brain Control Your MoneyFree Books for KindleTuned In: Uncover the Extraordinary Opportunities That Lead to Business Breakthroughs

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Posted in: Business,eBooks,Great,Kindle,SelfImprovement,Steals

Weekend Wisdom: Signs of Hope?

 

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What’s this?

Good economic news?

Come on. That can’t be right.

Well, the U.S. unemployment rate has taken some steps in the right direction and economic growth appears to be creeping back.

I wouldn’t say that the road to economic recovery is paved for us, but any signs of improvement are appreciated. It could be that irrational optimism that led to irrational pessimism is now on its inexorable pendulum swing back to the other side.

It may be that bloggers and writers are more hopeful in the new year, but hopeful writers have made it into my regular reading.

Here are a few of my faves for this week:

Forbes — MIT Gamechanger: Free Online Education for All

Investor Junkie — What Makes Debt Socially Acceptable

The Digerati Life — Three Affordable Ways to Beat Debt

Zero Hedge — Physical Silver Surges To Record 30% Premium Over Spot, In Backwardation

Free Money Finance — 14 Fun Staycations

Daily Money Shot – Updating Your Skills to Find Part-Time Income

Yes I Am Cheap — Starting an Emergency Fund with the Right Amount of Money

So Over Debt — 3 Finance Tips I Got From Watching Cartoons

Funancials — Should I Cancel My Credit Cards

Money Crush — Improve Your Future in 5 Minutes

Blonde on a Budget — January 2012 Jar and Goals

Art of Manliness — Willpower Part I

Related posts: Weekend Wisdom: The Rogue Blogger EditionWeekend Wisdom: 100 Percent Chance of WisdomWeekend Wisdom: Ho-Ho-Holiday EditionWeekend Wisdom: Everything is Boo-tifulWeekend Wisdom: Einstein and Turkey

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Weekend Wisdom–The Revolution Will Be Wikied

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It only took Wikipedia one day to teach the world that it will take a lot more than government bureaucrats to stop information and knowledge from circulating on the web.

The act of protest–shutting down the site–chilled the forces who were trying to push the anti-piracy legislation. Several other sites joined in.

Is there a compromise position? I think everyone’s entitled to the rights of their works. But this didn’t appear to be the right legislation.

What I think this week taught us — or maybe just me, I can’t speak for everyone — is that the real government is truly outside of the bureaucracy now. If we can influence decisions this way, could we begin to grab other powers away from the government, back to ourselves? That’s a question mark for a reason. There’s a fine line between collective intelligence and mob mentality. And that fine line is called knowledge.

Anyway. The web survived intact. And I was still able to do some online reading.

Here’s what I found…

I Will Teach You to be Rich — What the Pros Know About Networking that Your Don’t

Free Money Finance — 7 Ways to Make the Most of Your Gift Cards

Money Crashers — What is Preferred Stock

Generation X Finance — 5 Reasons to Not Borrow From Your 401K

Marginal Revolution — Simulations and the Fermi Paradox

Investor Junkie — Want to be a Great Investor? Learn How to Shop

Over Your Head — Quite Everything. Go Everywhere. A Conversation with Chris Guillebeau

A Dash of Insight — Why the Average Investor is Bamboozled by Recession Forecasts

The Finance Buff — Experiment: Buying on the Dip

My Two Dollars — It’s Not What Your Earn, It’s What Your Spend

Four Hour Work Week Blog — How to Become an Effective CEO: Chief Emotions Officer

Related posts: Weekend Wisdom: Financial StrugglesWeekend Wisdom: The Rogue Blogger EditionWeekend Wisdom–Make Your Own Good LuckWeekend Wisdom — New News for a New YearThree Ways To Prepare For The Automated Trading Revolution

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Posted in: Revolution,Weekend,Wikied,WisdomThe