Good debt? Person working out financial business plans

Does good debt really exist? It can do.

In case you are wondering whether there is such thing as good debt, the answer is clear. There is. Some causes or personal and professional goals justify taking out debt.

Obviously, spending on your credit cards to have the latest designer handbag is never a good idea, but you can use credit to improve yourself and build wealth. Below you will find a few examples of taking out credit and investing money in your future.



Investing in your education is a good decision that will pay off for years or decades to come. Most people get student loans in the hope that they will have no difficulties paying it back once they secure their dream job.

A word of warning though: make sure that you consider your job prospects and the market demand for your skills before you get into debt to complete a course. Be ready to change your subject choice during your studies when your circumstances or the job market change.


Moving for a Job

When you are offered an opportunity to study or work abroad, get an apprenticeship, or become a manager, you shouldn’t refuse the proposal just because you don’t have enough savings to cover the move.

Instead, treat it as a credit that is an investment in your future career, and treat it as a beneficial debt. The more you travel and learn, the more valuable your skills will be on the job market.


Home Improvements

You can add value to your property by investing in home improvements. The value you add will be much higher than the money you spend overall on the credit.

However, always get a valuation before you start any major renovation and remodeling project, and ask an expert realtor for an expert opinion before you make the final decision.

Starting Your Business

When you are certain that you can improve your lifestyle and work-life balance, as well as your financial situation long term, it is OK to take out a loan to start a business.

Obviously, you will have to have a solid business plan before you can decide whether or not your idea is feasible. Joining a pyramid scheme or starting off as an agent might not be a clever decision, but if you buy into an established franchise or want to make money off your existing skills, you will need the startup funds ready.

Debt Consolidation

If you are currently struggling with debt and can’t make ends meet due to your high repayments, it is acceptable to take out credit to replace your existing agreements and reduce the interest rate. Check out to find out what types of financial products are available for people who want to clear their credit cards and want to reduce their monthly outgoings.


Not all debt is created equal. But good debt can actually be beneficial. Some long term goals can justify your decision to get credit and achieve a high return on your initial interest that will cover the amount you borrowed, the interest, and more.

Focus on where you want to be ten years from now, and stay realistic about the results you can achieve.


Good Debt: 5 Things Debt is Good For
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