Just because the world "debt" is thrown around as if every time someone is in debt, it is a negative thing. This is simply not the case. Debt is the result of a loan to help educate someone. That is an example of a Good Loan because the purpose of obtaining the debt in the first place and after the debt is paid off is positive. Another example of a good debt is a mortgage.
An education will never "lose" value, so investing into it is never a bad idea. Homes usually don't lose value either, so these debts are not bad debts until you add the factor of "too much debt." In which case you should refer to my other posts that offer solutions to your debt problems through debt management services.
One of the most infamous examples of a bad debt is a car loan. A vehicle will almost never increase in value, and almost always decreases a large amount of value as soon as the vehicle is purchased. Say for example you bought a new car with a value of $20,000. After financing charges from the loan, you will pay around $25,000 total. But as soon as the transaction has been made, the vehicle is now considered "used" instead of "new" and will lose a good chunk of its value. So now you're paying $25,000 on a car that is only worth $13,000. Tough Break.
Look out for Bad Debt, but don't shy from Good Debt because it has the word "debt" in it!
