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Leverage is a term used in business for borrowing money
or using debt to buy assets.
Other people’s money (OPM) has been deployed for
centuries to help governments and businesses to raise capital, which I’ve
written about in my book, Borrow and Grow Rich.
There is a big difference between good debt, which helps
you buy assets that produce income, capital growth, and create jobs and bad
debt to consumer goods which go down in value.
Can you think of an example of where you have used good
debt or leverage to buy an asset like a property?
Have you also used bad debt, such as a credit card, to
buy something that you didn’t want to save up for?
How much has that item cost you in interest?
Lessons
Use good debt, leverage and OPM to accelerate your wealth
building process.
Avoid credit cards and other bad debt and only use a
credit card to pay for things that you can repay in full at the end of the
month.
If you have credit card debts, start on a plan to clear
the balance as soon as possible, rather than just paying the minimum amount
each month.
Join my Money Tips 365 Supporters Club on Spotify: -
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