Debt Management.

[Y3shot]

I stopped collecting debt because whenever I missed the due date, the interest rate would be increasing daily and if I don't have money to pay on time then the interest would be accumulating to a reasonable amount again before I would have money to pay the interest would be almost equal to the capital. So I don't like loan at all. Except someone I know gave me the funds and we are agreed that they would be no interest to add them I will take the loan and pay back on time because they person too has programmed himself to use that money on that due date so any failure to provide that money, will also affects his plans. So those are some of the technics for debt management.

I think it is a good decision, sometimes I wonder why people would go for a loan that dip down in their mind they know they have no means on how the dept will be played.  When one always go for the loan that they can easily pay back it help financially especially in business.  What had made so many businesses to fold is when people go for loan that is bigger than thier business at the the end of everything they won't be able to pay the loan.  This affect business so much that may end up paying the loan with money that is made for business.  Every business has a limit of loan that won't be a burden or stress to pay back.

[Fortify]

Borrowing or taking loans is not bad but being a debtor is where the problem lies. What I'm trying to say is that, it's normal to be in need and borrow when you lack, but owing for too long or not being able to clear your debts at the appropriate time, is the problem and can be very embarrassing. Now that's where Debt management comes in, Debt management to my understanding is a process where by one plans strategic means of attending to their debts thereby avoiding numerous debts and be debt free.

 Dept Management is something every human is supposed to be aware of so as to help tackle the problems of being a debtor. Left for me, one who is in debt is like a slave and is bound to face being embarrassed if not they don't apply debt management. That's why before one should take loans, there are many things that's need to be considered. However here are the necessary steps people should take to become debt free;
 Learn to cut cost: one needs to avoid too much spendings, normalize spendings only on necessary things, either for food bills, craving or wants, your expenses should be focused on your needs and not wants.

 Make Budgets: making a bucket list of budgets would aid you to monitor your income and also help you to make right decisions on important expenses.

Avoid spending beyond your budget: this is also another way of debt management because when you spend only what you can afford, it would help you from being a debtor cause you'll be more focused on things you need.

Do not borrow funds to clear debts: doing that automatically makes you acquire more debts and it keeps accumulating because you won't seize to acquire outstanding debts, it would continue to go in cycles until you work hard to earn and become totally free.

Clear debts on time : no one is above being in debt, however one shouldn't settle with being known for a debtor, it brings embarrassment and could cause emotional trauma, therefore one needs to keep tracks of their dept and work on paying them off, beginning high interest debts down to minor ones, needs to be strategic with clearing their debts.

Right choice of investments: investmenting on the right business is just like saving for the future, cause you'll always have a financial support to fall back to, and also avoid taking loans, therefore the right choice of business would guarantee you have a safe heaven rely on instead of taking loans.

Make wise spendings: Consider your financial strength before purchasing items, purchase only items that are of needs not the ones that don't match your financial strength.

 Another way of debt management I could think of is to learn to make proper financial decisions, one should educate themselves financially about  investments and how to plan financially to be debt free.

 Here are some debt management charts to help you understand further.

In Conclusion
 The concept of debt management isn’t talked about often, this is why most people dwell so deeply in debt and they can’t afford to pay it off. In worst cases where the debtor can’t pay back, they tend to take their life, giving up so easily just in the name of frustration. Sometimes taking debt can be a way out for one, that's if you have an innovative mind and know how to utilize the resources given to you. Some people just don’t know how to manage funds, borrowing money to clear debt or to fund your lifestyle isn’t just the best idea infact, it’s just the beginning of your borrowing cycle. If you don’t have any reasonable plan then there isn’t any need to go for a loan.

I'm not sure all the stuff you've put in there is necessarily true. Take "do not borrow funds to pay off debt" as an example. There is a strategy out there of using a consolidation loan which is suitable for some people, although that segment might be relatively small - if you can get a loan rate better than the average if your remaining debt, then it's definitely worth paying off other debts with it to lower your repayments. Also, the only really worthwhile type of debt out there is a mortgage, as the asset is appreciating over time and usually higher than the interest rate you'll be paying over the lifetime of the mortgage.

[Zanab247]

Personally not wrong with debt or taking loan for business capital depend has balance under 20% loan of assets having, but many people take risk with bigger debt or loan than how much assets they have and get collapse with their business have to sell all their property or assets to recovery loan interested.

Something that can collapse your business and you are saying is not wrong, loan will not allow you to concentrate in your business or hodling because you will be thinking how to pay back the loan and it can make you not to make a good profits from your business because your mind is not on that business.

Never allow anybody to encourage you to borrow money to start a business, because I have seen many people going to the bank to borrow huge amount of money to start a big business and something happen that make the person to committed suicide because there is no way he can pay back the money than to end his life, which are some of the things loan can cause.

If you want to live a good life to live long to enjoy your wealth, never you dream of loan no matter the condition you find yourself because it will not help you to grow well like other business men and women in your environment.

[AnonBitCoiner]

Banks in every country offer loans to their customers in several stages. In the country where I live, banks usually offer relatively low interest loans for a few things. I can take money loan for building our house here as well as for business I can take money loan and I can also take loan for agriculture. But there are certain conditions in these cases and the bank will give me a loan according to my position subject to certain conditions.

Banks will only allow loan money to you if you are a government employee otherwise it is not possible that the bank will give you a loan without your identification. If a bank gives you profit then it does not mean that you will return it according to your affordability but the government will fix the amount and timing so you will return some percentage from your salary on a monthly basis to return that loan amount.

Taking a loan will minimize your salary and you will become unable to manage the monthly expenses of your home therefore save little by little from your salary and when you accumulate a huge sum then either invest it or save it.

[Ever-young]

I'm not sure all the stuff you've put in there is necessarily true. Take "do not borrow funds to pay off debt" as an example. There is a strategy out there of using a consolidation loan which is suitable for some people, although that segment might be relatively small - if you can get a loan rate better than the average if your remaining debt, then it's definitely worth paying off other debts with it to lower your repayments. Also, the only really worthwhile type of debt out there is a mortgage, as the asset is appreciating over time and usually higher than the interest rate you'll be paying over the lifetime of the mortgage.

You're absolutely right.
There are certain situations you'll find yourself, borrowing some money to pay off an overdue loan could prove to be quite a viable approach, such as a credit card transfer or consolidation of debt with a lower interest loan. These strategies can really come in handy and help to simplify payments as well as save on interest.

Regarding Mortgage, you're also very correct that they could be considered a form of debt, especially when there's an appreciation in the price and value of the asset and the interest rate is also reasonable.
As a matter of fact, mortgage can equally considered to be a form of forced savings, because the owners of the asset builds equity in their properties on the long run.

[slapper]

Personally not wrong with debt or taking loan for business capital depend has balance under 20% loan of assets having, but many people take risk with bigger debt or loan than how much assets they have and get collapse with their business have to sell all their property or assets to recovery loan interested.

Something that can collapse your business and you are saying is not wrong, loan will not allow you to concentrate in your business or hodling because you will be thinking how to pay back the loan and it can make you not to make a good profits from your business because your mind is not on that business.

Never allow anybody to encourage you to borrow money to start a business, because I have seen many people going to the bank to borrow huge amount of money to start a big business and something happen that make the person to committed suicide because there is no way he can pay back the money than to end his life, which are some of the things loan can cause.

If you want to live a good life to live long to enjoy your wealth, never you dream of loan no matter the condition you find yourself because it will not help you to grow well like other business men and women in your environment.

We've all heard the bad stories, businesses folding under debt. But avoiding loans altogether, that's not smart, that's scared. Some of the biggest wins come from smart borrowing. It's not about never taking loans, it's about doing it right. If the idea of a loan feels like rolling dice, you ain't there yet. But if you've crunched the numbers, know your market inside-out, and have contingencies in place... that's different. That's not gambling, that's calculated risk-taking. Arm yourself with information, find advisors who aren't afraid to tell you the hard truths, and then? Then a loan might be your rocket fuel, not an anchor to the ocean floor. It's about strategy, not just saying "yes" or "no".

[ultrloa]

Personally not wrong with debt or taking loan for business capital depend has balance under 20% loan of assets having, but many people take risk with bigger debt or loan than how much assets they have and get collapse with their business have to sell all their property or assets to recovery loan interested.

Something that can collapse your business and you are saying is not wrong, loan will not allow you to concentrate in your business or hodling because you will be thinking how to pay back the loan and it can make you not to make a good profits from your business because your mind is not on that business.

Never allow anybody to encourage you to borrow money to start a business, because I have seen many people going to the bank to borrow huge amount of money to start a big business and something happen that make the person to committed suicide because there is no way he can pay back the money than to end his life, which are some of the things loan can cause.

If you want to live a good life to live long to enjoy your wealth, never you dream of loan no matter the condition you find yourself because it will not help you to grow well like other business men and women in your environment.

If you are just starting up for sure taking some loan will never be a great idea since for this you are already at lose since imagine the percentage you need to pay with those loaning institution which can affect your business especially if this is not in stable situation. That's why I never recommend anyone to start with loan since they will just be in huge mess with that especially if their business fail for sure there life will became more miserable. They can actually take loan for expansion especially if you business is already well established or sustainable since this could able to help you to increase your capabilities to gain more money and I think this is what we called good debt since you are for expanding and your business already could able to pay those amount your borrowed from institution. If I am not wrong if you have good credit score with bank, you can negotiate with the rates or other things that may favor on your side.

[Tmoonz]

I totally agree with everyone that said it's better not to even go into debts than find a solution around it. It's only good to know all this that op has stated if only one is already in debt.

So if one is wanting to take a loan and/or borrow from any source then it should be a very much productive purpose, either to make an investment that can yield back the profit earlier before the expected month not even date. But mind you this exception is basic for only few investments not every investment is good to take loans, there are some investments like bitcoin investment it's absolutely not idea to borrow or take loans in order to invest or purchase bitcoin because of it volatility, profit is not guaranteed.
So the issue of loan or borrowing should even be eliminated in the minds of investors even in times of desperations.

I don't agree with that very part I bolded, there is nothing absolutely wrong optioning for a loan if the intention is to increase your credit score, my wife and I are testimony to this, we actually relocated in to a new area and later started a provision shop in front of the house of which we discovered that there where no provisions shops in that area we took that advantage and started one with few items just as little as our we can afford at that time, but as time goes on there were several demands of certain goods which were not available because of our limited capital but considering the intensity of the demand of those goods that were not available, we took a loan to buy those goods and we paid back even before the expected time  and that has expanded our business and boost our credit scores, no one should be a debtor on the occasion of trying to sustain or maintain a lifestyle. However, many find it difficult to pay  debt as a habit even when they have it this is one simple truth that is very bitter.

[ancafe]

Borrowing or taking loans is not bad but being a debtor is where the problem lies. What I'm trying to say is that, it's normal to be in need and borrow when you lack, but owing for too long or not being able to clear your debts at the appropriate time, is the problem and can be very embarrassing. Now that's where Debt management comes in, Debt management to my understanding is a process where by one plans strategic means of attending to their debts thereby avoiding numerous debts and be debt free.

The term borrowing is always said to be bad among people and indeed the effect is big when you are in debt but the money is not used for more productive things. Borrowing money to develop a business is not bad as long as we can make good plans. Debt is much more productive if used to develop a business that has been assessed as having a high level of success. With a smooth business, we will be able to plan or take care of the necessary financing so that debt does not become a problem in our lives

It is a fatal mistake to take out a loan for unnecessary needs, such as to fulfill your lifestyle and buy something you don't need. If you take on debt to develop your business, it is not a problem because without taking risks we will never know the success we want to achieve. It is important to make a plan, both for debt payments and procedures for developing your business so that it progresses further.

[Alone055]

I don't agree with that very part I bolded, there is nothing absolutely wrong optioning for a loan if the intention is to increase your credit score, my wife and I are testimony to this, we actually relocated in to a new area and later started a provision shop in front of the house of which we discovered that there where no provisions shops in that area we took that advantage and started one with few items just as little as our we can afford at that time, but as time goes on there were several demands of certain goods which were not available because of our limited capital but considering the intensity of the demand of those goods that were not available, we took a loan to buy those goods and we paid back even before the expected time  and that has expanded our business and boost our credit scores, no one should be a debtor on the occasion of trying to sustain or maintain a lifestyle. However, many find it difficult to pay  debt as a habit even when they have it this is one simple truth that is very bitter.

Taking loans for business purposes is never a bad idea, especially if you know that your business can generate enough revenue using that loan to make it possible to repay the loan on time or even before it. In your case, this was exactly what happened because you already had your business started, and you were witnessing the demand for certain products that you knew would generate good revenue for the business, so you felt confident taking the loan because you knew it in advance that you are going to repay the amount before time.

However, it's never a good habit to take personal loans when you don't have a stable source of income and you are not sure whether you will be able to repay the loan on time or not because when you are not earning money at all or not earning constantly, you will only become a defaulter at the end of the day and that isn't a good practice.

So there are good debts and bad debts, a good debt is the debt that is easily payable and wouldn't create problems and a bad debt is the one that will get the borrower in trouble because they won't be able to pay it easily.

[JayJuanGee]

I don't agree with that very part I bolded, there is nothing absolutely wrong optioning for a loan if the intention is to increase your credit score, my wife and I are testimony to this, we actually relocated in to a new area and later started a provision shop in front of the house of which we discovered that there where no provisions shops in that area we took that advantage and started one with few items just as little as our we can afford at that time, but as time goes on there were several demands of certain goods which were not available because of our limited capital but considering the intensity of the demand of those goods that were not available, we took a loan to buy those goods and we paid back even before the expected time  and that has expanded our business and boost our credit scores, no one should be a debtor on the occasion of trying to sustain or maintain a lifestyle. However, many find it difficult to pay  debt as a habit even when they have it this is one simple truth that is very bitter.

Taking loans for business purposes is never a bad idea, especially if you know that your business can generate enough revenue using that loan to make it possible to repay the loan on time or even before it. In your case, this was exactly what happened because you already had your business started, and you were witnessing the demand for certain products that you knew would generate good revenue for the business, so you felt confident taking the loan because you knew it in advance that you are going to repay the amount before time.

However, it's never a good habit to take personal loans when you don't have a stable source of income and you are not sure whether you will be able to repay the loan on time or not because when you are not earning money at all or not earning constantly, you will only become a defaulter at the end of the day and that isn't a good practice.

So there are good debts and bad debts, a good debt is the debt that is easily payable and wouldn't create problems and a bad debt is the one that will get the borrower in trouble because they won't be able to pay it easily.

We should face the fact that there are  a lot of debt systems in the world in the past 20-50 years, and many of them building up more and more, and there are ways to take advantage of such systems without abusing them or putting yourself in a bad situation - so debt can be used in a variety of smart ways in order to enhance cashflow or even build up a credit score for potential future use (Tmoonz mentioned) - that could also be thought of as a kind of insurance policy.

Frequently with debt things could be purchased at an earlier time that otherwise might not be affordable - including if you might have to wait 10 or more years to save up and you might lose some of the value of time, whether that is buying a home that you might never be able to buy if you had to save up in dollars that are losing their value.. .. of course, these days we have bitcoin, which is likely (at least historically) has been a way better way to be saving up for some future high ticket item purchase, such as a house.

And, yeah, the whole system of debt is screwed up since many folks have to get into debt in order to get a higher education, and sometimes that can make sense if you are later able to increase your social status or your job skills and perhaps be able to get into social/employment circles that you would not have previously had been able to enter.

Sure, the business or investment examples are not a bad ones either, and yes that relates to productive rather than consumptive purposes, and so some of the ways of thinking about a loan would be to consider how much the loan is costing to service  - which surely such costs of any loan can be projected out and surely some folks are able to garner better loan terms than others (both in terms of length of the loan and interest rate), partly based on credit score, but also might be based on putting up collateral.  Part of the calculation for the loan should be a consideration that whatever you are doing with the loan is going to be able to earn you equal or more money than it costs you to get the loan.. and surely some of those future numbers are not completely known, so many times there will be some risks in terms of being wrong in your calculations, so surely you should be trying to make sure that you are able to service your loan (in whole or in part) from funds that are other than the thing(s) that you are investing into.

It seems in this thread that a lot of members are focusing on the negative aspects of loan, which seems to include both when people are getting loans for potentially ill-thought out reasons, and so sometimes they will end up getting into bad situations when they are using loans to consume beyond their means. but maybe not realizing that they are engaged in such ill-thought out practices, and surely those are things that happens with loans - but the mere fact that people use debt in bad ways and don't know how to manage it does not mean that it cannot be a powerful thing that we should be able to use to our advantage.. especially if we either have cashflows to service debts, we may be able to increase our cashflows with such debt and/or we might have various assets that we are able to put as collateral .. and surely maybe some of our assets are accumulating value at a rate that is equal or greater than the costs of servicing the debt (whether there may be ways to use bitcoin as pristine collateral or other forms of collateral that we might believe is more valuable to hold onto rather than to sell.. but still be able to generate cashflow by using debt - and some of the ways of managing debt can be complicated and not necessarily one would want to do without employing ways of hedging themselves).

[Richbased]

Taking loans for business purposes is never a bad idea, especially if you know that your business can generate enough revenue using that loan to make it possible to repay the loan on time or even before it. In your case, this was exactly what happened because you already had your business started, and you were witnessing the demand for certain products that you knew would generate good revenue for the business, so you felt confident taking the loan because you knew it in advance that you are going to repay the amount before time.

Actually taking a loan to execute a profitable business that the proceeds can be gotten in a short period is good but to me if the demand for a particular goods or products is high doesn't necessarily mean you will enter into borrowing just to please your customers and also make some profits because sometimes, customers do demand for a particular product but as soon as you make the product available for them they may not turn up to patronize you again because at that time you didn't have it they must have gone to buy it elsewhere and may even buy it cheaper over there so they will prefer going there from time to time with the belief that you sell things at higher prices to them

However, it's never a good habit to take personal loans when you don't have a stable source of income and you are not sure whether you will be able to repay the loan on time or not because when you are not earning money at all or not earning constantly, you will only become a defaulter at the end of the day and that isn't a good practice.

If you even have a steady income what's the essence of taking a loan when you can easily be patient till your income arrives then you can purchase whatever you need and if it is something that is more than your earning per week or month then you can save up and get it instead of taken a loan.

So there are good debts and bad debts, a good debt is the debt that is easily payable and wouldn't create problems and a bad debt is the one that will get the borrower in trouble because they won't be able to pay it easily.

To me there is nothing like good debt and bad debt, all debts are equal inasmuch as you haven't paid a debt you are owing. Even if you take a loan and use it for something important that you know you gonna pay back within a short period, what if where you hope on fails you? And again when paying back a loan it looks as though you are paying a free money to your lender and it also takes you backwards because the income you would have planned to use for other things you will spend it in settling outstanding debts.

[Salahmu]

I don't agree with that very part I bolded, there is nothing absolutely wrong optioning for a loan if the intention is to increase your credit score, my wife and I are testimony to this, we actually relocated in to a new area and later started a provision shop in front of the house of which we discovered that there where no provisions shops in that area we took that advantage and started one with few items just as little as our we can afford at that time, but as time goes on there were several demands of certain goods which were not available because of our limited capital but considering the intensity of the demand of those goods that were not available, we took a loan to buy those goods and we paid back even before the expected time  and that has expanded our business and boost our credit scores, no one should be a debtor on the occasion of trying to sustain or maintain a lifestyle. However, many find it difficult to pay  debt as a habit even when they have it this is one simple truth that is very bitter.

Taking loans for business purposes is never a bad idea, especially if you know that your business can generate enough revenue using that loan to make it possible to repay the loan on time or even before it. In your case, this was exactly what happened because you already had your business started, and you were witnessing the demand for certain products that you knew would generate good revenue for the business, so you felt confident taking the loan because you knew it in advance that you are going to repay the amount before time.

However, it's never a good habit to take personal loans when you don't have a stable source of income and you are not sure whether you will be able to repay the loan on time or not because when you are not earning money at all or not earning constantly, you will only become a defaulter at the end of the day and that isn't a good practice.

So there are good debts and bad debts, a good debt is the debt that is easily payable and wouldn't create problems and a bad debt is the one that will get the borrower in trouble because they won't be able to pay it easily.

We should face the fact that there are  a lot of debt systems in the world in the past 20-50 years, and many of them building up more and more, and there are ways to take advantage of such systems without abusing them or putting yourself in a bad situation - so debt can be used in a variety of smart ways in order to enhance cashflow or even build up a credit score for potential future use (Tmoonz mentioned) - that could also be thought of as a kind of insurance policy.

I agree with you on that although I was channeling my perception in terms of  borrowing money for investment on one angle but however after reading your reasons and explanations I feel more clarified, actually what you said is correct because in as much as most people feel that borrowing money for investment is not good but their are numerous of people who are sustainable and making a huge profit on their business through the money they borrowed, however I think the negative and positive outcome of borrowing money is totally depends on individual on how well they were able to utilize those money.

Perhaps this discussion reminds me of someone who has a good business idea and was very certain of the success but the problem he was facing was actually how to finance it because at that moment he was financially unstable so had to go to the Bank to get some loan and with his good business idea he was able to utilize the money he borrowed very well by securing a good business and at the same time settle all the debt, so actually with a proper planning borrowed money could be use to achieve a lot.

[Tmoonz]

We should face the fact that there are  a lot of debt systems in the world in the past 20-50 years, and many of them building up more and more, and there are ways to take advantage of such systems without abusing them or putting yourself in a bad situation - so debt can be used in a variety of smart ways in order to enhance cashflow or even build up a credit score for potential future use (Tmoonz mentioned) - that could also be thought of as a kind of insurance policy.

Frequently with debt things could be purchased at an earlier time that otherwise might not be affordable - including if you might have to wait 10 or more years to save up and you might lose some of the value of time, whether that is buying a home that you might never be able to buy if you had to save up in dollars that are losing their value.. .. of course, these days we have bitcoin, which is likely (at least historically) has been a way better way to be saving up for some future high ticket item purchase, such as a house.

And, yeah, the whole system of debt is screwed up since many folks have to get into debt in order to get a higher education, and sometimes that can make sense if you are later able to increase your social status or your job skills and perhaps be able to get into social/employment circles that you would not have previously had been able to enter.

Sure, the business or investment examples are not a bad ones either, and yes that relates to productive rather than consumptive purposes, and so some of the ways of thinking about a loan would be to consider how much the loan is costing to service  - which surely such costs of any loan can be projected out and surely some folks are able to garner better loan terms than others (both in terms of length of the loan and interest rate), partly based on credit score, but also might be based on putting up collateral.  Part of the calculation for the loan should be a consideration that whatever you are doing with the loan is going to be able to earn you equal or more money than it costs you to get the loan.. and surely some of those future numbers are not completely known, so many times there will be some risks in terms of being wrong in your calculations, so surely you should be trying to make sure that you are able to service your loan (in whole or in part) from funds that are other than the thing(s) that you are investing into.

It seems in this thread that a lot of members are focusing on the negative aspects of loan, which seems to include both when people are getting loans for potentially ill-thought out reasons, and so sometimes they will end up getting into bad situations when they are using loans to consume beyond their means. but maybe not realizing that they are engaged in such ill-thought out practices, and surely those are things that happens with loans - but the mere fact that people use debt in bad ways and don't know how to manage it does not mean that it cannot be a powerful thing that we should be able to use to our advantage.. especially if we either have cashflows to service debts, we may be able to increase our cashflows with such debt and/or we might have various assets that we are able to put as collateral .. and surely maybe some of our assets are accumulating value at a rate that is equal or greater than the costs of servicing the debt (whether there may be ways to use bitcoin as pristine collateral or other forms of collateral that we might believe is more valuable to hold onto rather than to sell.. but still be able to generate cashflow by using debt - and some of the ways of managing debt can be complicated and not necessarily one would want to do without employing ways of hedging themselves).

@jayjuanGee, your thoughts are quite commendable, recommendable,and understandable. However, many people becomes vulnerable and prone to not being able to repay loan, because they have no better plans or even a backup plans as regards to replaying their loan, yeah it is also very important to have a backup plans Incase where the first plan didn't work out, while others will be considering taken loans with so much negativity, others are massively taken advantage of it, I will also like to share this experience that has been a culture ii my country, which is a scarcity of Petrol at every end of the year of about let me say between November and December, petrol are usually scarce and costly within this period and every one  knows how much of the importance of Petrol, I had a friend who owns a filling station, what he does is to mortgage a laon  from a bank and paid for petrol ahead of time which means he will be buying at a more lower price and sell very high when getting at end of the year which puts him a whole lots of profits. Those criticizing about taken loans might not just have the ideas of how to explore with funds when an opportunity is given or probably some might be scared of taking the risk taken loan mean while some risk really worth taken if only you know what you doing by utilizing it wisely.

[Frankolala]

Taking loans for business purposes is never a bad idea, especially if you know that your business can generate enough revenue using that loan to make it possible to repay the loan on time or even before it. In your case, this was exactly what happened because you already had your business started, and you were witnessing the demand for certain products that you knew would generate good revenue for the business, so you felt confident taking the loan because you knew it in advance that you are going to repay the amount before time.

Actually taking a loan to execute a profitable business that the proceeds can be gotten in a short period is good but to me if the demand for a particular goods or products is high doesn't necessarily mean you will enter into borrowing just to please your customers and also make some profits because sometimes, customers do demand for a particular product but as soon as you make the product available for them they may not turn up to patronize you again because at that time you didn't have it they must have gone to buy it elsewhere and may even buy it cheaper over there so they will prefer going there from time to time with the belief that you sell things at higher prices to them

It all depends on the products that you are selling. If it is a product that cannot be seen easily or yours is cheaper, what you do is to tell the customers that needs the products to pay a deposit to show seriousness that they need the product and is ready to buy it from you. After they must have made deposits, you can go and take a loan to buy such products and after supply, you pay back your loan.

My mom was a contractor when we were still kids, she goes to look for contracts on supplying of commodities for companies, and whenever she have a contract that she cannot afford to execute it, she takes loan and after supplying she gets paid and also pay back her loan. Loan is good in a business that the odds of generating profit is high than loss, especially in a business that you are well knowledgeable on.

In my environment, a lot of businesses are surviving through loans and they pay it bit by bit till they finally pay up. Some of them will even collect a bigger amount again after they have paid back the recent one.

[Zackz5000]

I totally agree with everyone that said it's better not to even go into debts than find a solution around it. It's only good to know all this that op has stated if only one is already in debt.

So if one is wanting to take a loan and/or borrow from any source then it should be a very much productive purpose, either to make an investment that can yield back the profit earlier before the expected month not even date. But mind you this exception is basic for only few investments not every investment is good to take loans, there are some investments like bitcoin investment it's absolutely not idea to borrow or take loans in order to invest or purchase bitcoin because of it volatility, profit is not guaranteed.
So the issue of loan or borrowing should even be eliminated in the minds of investors even in times of desperations.

I don't agree with that very part I bolded, there is nothing absolutely wrong optioning for a loan if the intention is to increase your credit score, my wife and I are testimony to this, we actually relocated in to a new area and later started a provision shop in front of the house of which we discovered that there where no provisions shops in that area we took that advantage and started one with few items just as little as our we can afford at that time, but as time goes on there were several demands of certain goods which were not available because of our limited capital but considering the intensity of the demand of those goods that were not available, we took a loan to buy those goods and we paid back even before the expected time  and that has expanded our business and boost our credit scores, no one should be a debtor on the occasion of trying to sustain or maintain a lifestyle. However, many find it difficult to pay  debt as a habit even when they have it this is one simple truth that is very bitter.

I totally agree with you, yes nothing is wrong optioning for a loan just like u said if your intention is to increase your credit score, I don't think there is anyone that will went to option for a loan without having of better intention on the process we should also pray against unforseen challenges that may come up and scatter the good intention we have, in other not to enter into more problem that is one of the disadvantage of optioning for a loan.
There are some people that find it very easy to collect loan but difficult to repay back the loan they have collected with there sweet talk when taking loans this type of people end up losing there properties.

Loan has helped somany person in life today it has helped me, the business am doing now is a result of the loan I took and I have repay back and still stand strong in the business.
In summary we should always pray against unforseen circumstances  that may went to eat up the money we borrowed in other not to put us in more danger.

[JayJuanGee]

[edited out]

@jayjuanGee, your thoughts are quite commendable, recommendable,and understandable. However, many people becomes vulnerable and prone to not being able to repay loan, because they have no better plans or even a backup plans as regards to replaying their loan, yeah it is also very important to have a backup plans Incase where the first plan didn't work out, while others will be considering taken loans with so much negativity, others are massively taken advantage of it,

The mere fact that some people do not know how to utilize debt or they fuck up their lives because of debt should not mean that each of us should not figure out ways that we can become empowered from the use of debt, whether it is being able to improve our skills and abilities by improving ourselves through something like a college education or  our ability to get ourselves into a suitable house instead of having to wait for 20-30 years to save up to buy it with cash - in the event that we might not know how to invest our cash properly.

I will also like to share this experience that has been a culture ii my country, which is a scarcity of Petrol at every end of the year of about let me say between November and December, petrol are usually scarce and costly within this period and every one  knows how much of the importance of Petrol, I had a friend who owns a filling station, what he does is to mortgage a laon  from a bank and paid for petrol ahead of time which means he will be buying at a more lower price and sell very high when getting at end of the year which puts him a whole lots of profits. Those criticizing about taken loans might not just have the ideas of how to explore with funds when an opportunity is given or probably some might be scared of taking the risk taken loan mean while some risk really worth taken if only you know what you doing by utilizing it wisely.

That is a decently good example.  Sure it is not guaranteed that the guy buying the petrol is going to be able to profit from his own ability to stock up extra petrol in advance, but like you mentioned it is worth taking the chance since there is a bit of a history that helps to support a quite likely scenario that the loan is likely going to be able to largely pay for itself and also deliver extra profits to him, and there are likely other examples of loans that can be entered into that are similar to that kind of a scenario, even though sometimes the results are not as tested or as guaranteed, but frequently the expected values of various scenarios can be calculated in advance in order to attempt to weigh the likelihood of profits versus the likelihood of losses and still justify the loan if the likelihood of profits significantly outweigh the losses (including calculating various costs associated with the loan), even if there may well end up being some circumstances in which the loan ends up costing more than the profits that had been made from the loan and there could even be some scenarios in which the losses are quite high, but maybe not as likely to happen but such less likely scenarios should also be considered in terms of their weighing into the calculation regarding whether to get the loan or not.

[Hamphser]

Avoid spending beyond your budget

Stick with this and you should be fine. You are out of your mind if you do spend which is more than on what you do earn on single day. You are really just that
simply burying your own grave and would be ending up on getting drowned because of tons of loans or debts on which this is something that should really be avoided in the first place.
Having that good budgeting and allocation on priorities is something that you should be having in mind.

Its not bad to buy up some wants for sometime or having some leisure but having that control is something that you should bare up on your mind as always.

[Yucky]

Thank you for sharing your insights on debt management and the steps one can take to become debt-free.

Debt can indeed be a burden, and it is crucial to have a strategic plan in place to address and manage it effectively.

You rightly emphasize the importance of cutting costs and focusing on necessary expenses, distinguishing between needs and wants. Creating budgets and adhering to them can also provide a clear overview of income and help make informed decisions about spending. By avoiding spending beyond one's budget, individuals can prevent the accumulation of further debt and maintain financial stability.

I appreciate your suggestion of educating oneself about investments and financial planning to debt management skills. Proper financial knowledge and decision- making can empower individuals to make sound financial choices and work towards a debt-free life .

Thank you for sharing the debt management charts as well. Visual aids can be valuable tools in understanding and implementing effective debt management strategies

[Onyeeze]

There's one thing that is involved in borrowing money if you want to borrow money make sure that you borrow a money that you can be able to repay and the secondly borrowing money is good for someone who have a good vision to invest not a someone who have a short Vision because if you have a short division for any investment you cannot utilize a money that you borrowed from someone but if you have a good vision you can utilize the money you borrow and they also diversified the money to bring out another thing so I don't blame anyone who borrow money to invest because it is a part of risk and the risk is one of the things that makes a businessman to be rich more