Debt: good or bad?

[Cornish Steve]

When studying for my MBA a few years ago, I learned that debt is a good thing. To maximise profit, a company should strike the optimal balance between debt (which, in the US at least, is tax-deductible) and equity.

On the other hand, when looking for companies in which to invest, I found that several of the best-performing small public companies had no debt.

We have financed our current venture by using personal money and by obtaining unsecured debt; since the debt is unsecured, we won't lose our homes if things go wrong. We accept zero percent credit card offers, and we transfer balances from old cards to new cards once the initial introductory period (usually 12 months) is over.

What do others think about debt? Is it a good or a bad thing?

[bwglaw]

We need to define between a good debt and a bad debt. Bad debt is obviously bad and unhealthy. I see good debt a good thing and it has certainly made me more wealthy and secure so my future children are adequately provided for.

There is no other option for me to choose in the poll i.e. own funds. Personally, I don't like credit cards because I prefer to use my own funds.

The company has a 'credit card' for ad-hoc expenses but this does not operate quite like a credit card because the full amount on the card is debited from the company's account. This does improve our cashflow and I only use it when needed. Personally, I do not have a credit card and refuse to have one.

[Cornish Steve]

We need to define between a good debt and a bad debt. Bad debt is obviously bad and unhealthy. I see good debt a good thing and it has certainly made me more wealthy and secure so my future children are adequately provided for.

There is no other option for me to choose in the poll i.e. own funds.

I thought I had added another poll option, but it didn't appear. If the mods can add 'Other' as an option, I'd be grateful.

[Jayne]

We took out a secured loan on our house to buy the bakery building, I think it make you more conscious of keeping the business doing well, know-own wants to risk their home :D

I only have one credit card, I only got that to use on the internet. I like cash and debit cards.

Jayne

[Coding Monkey]

What if you didn't require any debt?

[Admiral Collections]

If your home is at risk let me kosh your debtors. Just PM me!

Nic :wink:

[gordonthegofor]

If your home is at risk let me kosh your debtors. Just PM me!

Nic :wink:

is that not counter productive to your business

[Admiral Collections]

Lol @ Gordon. Dont be sooooo serious Gordy.


Nic :wink:

[gordonthegofor]

Lol @ Gordon. Dont be sooooo serious Gordy.


Nic :wink:

:shock: sorry :oops: :D 8)