Financial Related

How To Benefit from Debt 

Warren Buffet, The King of Stock, once ever said “don’t get trapped in debt!” however, he never said “ don’t owe” so actually its fine to have debt, as long as it doesn’t burden us. Therefore, we need to recognize the type of debts.

Productive Debt
This type of debt is used to gain profit, like using debt to start business or expand business.

Consumptive Debt 
This is the most common debt, quiet depressing and burdening. The example of this debt is credit card, we use to buy our daily needs.

To make it more profitable, we have to be able to manage debt. For consumptive debt, buy everything based on what we need not what we want. We also have to be able to manage payment time, and wisely plan our finance. For Productive Debt, we can maximize debt to get more profit, for instance to expanse business. However, we need to perform a careful calculation, or else we will lose more money than gaining profit.