Planswell - The Deal with Good Debt and Bad Debt

Debt is way more than money borrowed from someone else. As per professionals like Planswell, it has become a part of our lives. Despite that, it is hard to count debts as a good thing. So, what’s the deal with these-good debt and bad debt? Keep reading to find out!

Good Debt

You can define good debt as the money you borrow to make more money or add to your net worth. Generally, these kinds of debts come with lesser interest rates. Here are some of the situations that make you borrow money good debt:


  • Education: That’s because an investment made in education can pay for itself later once you find employment.


  • Real Estate: From residential to commercial properties, you can generate money from your invested real estate. All you need to do is to learn how.


  • Business: The money you borrow with the potential financial rewards in the future can be categorized under the title good debt.

Bad Debt

Bad debt is exactly the opposite of good debt, and you can define it as the money you borrow to invest in depreciating assets. Let us get you clarity of the concept by giving you some examples here:


  • Cars:  Even though a car can seem to be a worthy investment, it still falls under bad debt. That’s because its value can depreciate with time.

  • Personal loans: If you are not precautious, taking personal loans can turn out to be a mistake. The same goes for loan shark deals.

The Bottom Line

By now, you can say that some debts can be good if you take them to maximize your wealth. And even if you have taken a bad debt, you can still find a way to deal with them. At Planswell, we can help you simplify and manage your debt. Feel free to connect with us now. 

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