There's no such thing as good debts, there's only proper money management

over 1 year ago

There's no such thing as "good debts"

You know how people say that most billionaires make their money from acquiring "good debts" like taking loans to build a business and all of that, well don't get fooled by this, just like many things the internet tends to publicize as good, it is a misrepresentation of "proper money management".

If you have a channel that gives you a good amount of income flow, you're living well, paying your bills comfortably and all, I see no reason why you should think of taking out a loan to start whatever.

We live in a world where we're born into debts, why choose to make it worse if you are unaware of your management skills when it comes to bigger money responsibilities? Investing what one earns to grow it into something bigger has always been the viable option when it comes to building wealth, debts? Not always a good choice. We've seen how networks that are built with debts function, there's always a large amount of pressure from the funders and that alone can build a significant pressure resulting in problems in scaling from the management team.

Billionaires got to where they are by proper money management, knowing when, how and why to invest, it wasn't about the source of the money, but where the money was going to. It wasn't because it was a "good debt" as they call it, in fact, don't most people take out loans to start a business? Why do the majority fail? Those weren't good debts?

Content creators, financial advisors, the internet and self-claimed finance smart people will tell you that if you take out a loan and put into this business and that, you'll flourish at this time, pay off the loan and scale on your own money from there, right?

But that's not how it works, even the richest man in the world today has debts, especially after the Twitter acquisition, Elon Musk has debts that he isn't willing to just pay off as it would make no sense looking at the cost of such action. The literal figures cannot be plainly estimated at this time, while this may not be a problem for him given his history in navigating that loans and avoiding taxes, it is however an example for us to understand that there will always be "continual debts" in such an atmosphere so deceiving small businesses to take part in what majority of them are not skillful in is quite sad.

The lack of proper money management will ruin any business, regardless of what type of money runs it, eventually, it will crash into the soil. The best option for small businesses looking to expand their reach is to do so by maximizing their current market first. If the business is able to weather the different seasons that have an impact on how things are run within then it should be ready to test out new waters.

Good debts do not exist, proper money management is what enables us to scale a business amongst many other primary and secondary factors.