Good Debt Versus Bad Debt: Do You Know the Difference?

A service member holding $20 bills in his hand

Life can be expensive, and most of us can't just pay for a house or a college education out of pocket. Today it's almost impossible to live without acquiring some kind of debt. And believe it or not, there are two kinds of debt: good and bad. Good debt can be used smartly to achieve your financial goals. Bad debt is what you get when you buy things you may not need with money you don't have. Even if you accumulate bad debt with the best intentions of paying it off, bad debt is just, well, bad, and it can be a slippery slope.

Don't just sit back and watch your debt grow, especially the bad kind. Commit to financial freedom by knowing the difference between good debt and bad debt — and how to manage both.

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