AllFinancialMatters

A personal finance blog dedicated discussing such topics as budgeting, asset allocation, 401K, IRA, cash flow, insurance, financial planning, portfolio management, and other areas in personal finance.

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Friday, February 25, 2005

Is There Such a Thing as Good Debt?

My friend, Michael over at the It's Your Money blog posted about a book that just came out called Good Debt, Bad Debt, by Jon Hanson. I haven't read the book yet, but it got me to thinking, is there really such a thing as good debt?

From a clearly economic viewpoint, I would have to say that yes, there really is good debt. What is good debt? Well, a mortgage is good debt (as long as you don't take on more than you can handle). In fact, I am of the opinion that if the interest rate is low enough, a person should not hurry to pay off the loan. It doesn't make sense to me for a person pay off a low interest loan with money that could be invested at a higher rate of return. (I posted about this back in October)

Anyway, that's my two cents worth.