We tend to think of debt as an evil term, as well we should! Despite what you may hear from some people, money truly does make the world go around. If it wasn’t for money we wouldn’t be able to go to restaurant and expect to be cooked for and served. It if was for money nobody would design and build the new iPAD. If it wasn’t for money construction workers would have no incentive to build our homes. Despite what many people have come to think, money can be a positive in our society if you use it wisely.
It should come as no surprise that debt comes with a price tag all it’s own. You can talk about mortgages, student loans, credit cards, car loans, personal loans, long term loans, short term loans…it really doesn’t matter what kind. That nasty little thing called interest is the cost of borrowing money from someone else. This rate is typically a hybrid of the return expected due to risk of lending, and loss of investment opportunity. Nobody is going to lend you money for free, except maybe some family and friends. Even then, these friends and relatives aren’t going to loan you an interest free $250,000 so that you can purchase a new home burden free.
The price of debt that we often neglect to recognize is of the more intangile variety, our health and emotional well-being. Buried deep in debt can bring out some pretty dark and horrible feelings, feelings that so many people struggle to overcome. Health issues can lead to further financial obligations such as medical bills, lost work time, or worse. Depression is no fun either, and can lead to the same results. More people need to consider the less obvious effects of debt as well. While they may not be financial at first, in the long run they can very much cost you money. Do yourself a favor and stay debt free!