What is the difference between good debt and bad debt?

[Himon2413]

While some loans help you increase your income, others can seriously affect your finances.

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When considering taking out a loan, you have to look at the situation as a two-sided coin. This decision can turn into a good debt or a bad one, a very bad one.
In the first case, the extra money will help us increase our productivity and future income, says Enrique Díaz, professor of Finance at ESAN .
"The first rule is to be sure that we can iran number screening pay back the loan. Monthly payments should not exceed 30% of a person's income," he explains.
Thus, a line of credit for the purchase of a home is justified, since it is an asset that will be revalued in the future and will improve our quality of life, says Díaz.
Another good debt is the one used to pay for studies, whether university or postgraduate. "The obligation becomes an investment, as it will increase our competitiveness in the workplace and our salary in the future," he points out.
Requiring a loan to invest in a business is also a good debt , but Díaz warns that care must be taken to prepare the project well, since in 80% of cases this is not done.
"The 30% rule should be maintained to avoid the risk of becoming over-indebted if the business fails," he advises.
HARMFUL SPENDING Bad debts are impulse purchases made by people who do not have the ability to pay. Credit cards are the enemy.