Good Debt Made Me Rich. Bad Debt Nearly Broke Me.
I was paying for yesterday with the money I needed for tomorrow. Then I took a mortgage at 1% on a rental property. That debt made me significantly wealthier.
What you'll learn
- The difference between consumer and productive debt
- How interest can work against you
- What to ask before borrowing
Good Debt Made Me Rich. Bad Debt Nearly Broke Me.
Debt is not one thing
Consumer debt and debt attached to a productive asset can have very different consequences.
Paying for yesterday
Consumer debt pulls future income backward.
Debt can build an asset
Borrowing for a productive asset can be different because something remains behind.
The rate is not the whole story
The asset, cash flow, risk and repayment terms still matter.
Ask what the debt creates
Before borrowing, ask what the debt leaves behind after the money is spent.
Not All Debt Is the Same
The deeper Mike Petry Journal essay connected to Episode 10, exploring the idea behind the episode from the perspective of money, behaviour and financial freedom.
Read the essay on Mike Petry Journal →What is Episode 10 about?
I was paying for yesterday with the money I needed for tomorrow. Then I took a mortgage at 1% on a rental property. That debt made me significantly wealthier.
The difference between consumer and productive debt
Consumer debt and debt attached to a productive asset can have very different consequences.
How interest can work against you
Consumer debt pulls future income backward.
Educational and entertainment content only. This page is not financial advice. Do your own research or speak with a qualified professional before making financial decisions.