Should I Invest or Pay Off Debt? | Phil Town

Student loan debt is an unsecured balloon loan, there is no longer a correlation between education and wealth. First red flag, but what do you expect from a baby boomer?

Never in a million years would I agree Debt is "Good". Why have good Debt when you can have No Debt and put 75 to 80 percent of your income towards investing. If you don't agree with me enjoy giving your money away to someone else.

Student loan debt is terrible debt.

You should pay off your debt first. Because paying off debt is investing in peace of your mind.

No Debt is "Good" debt!!

I have 3500 in a brokerage account and a personal loan with 14% interest. Should I close that and use the proceeds to get rid of my debt

sir I am a Indian but I wish to invest in US market how to do ? please share it

Good stuff as usual, thanks for doing what you do… I would only add that, (IMO) "good" debt is a misnomer, there's only bad debt, and worse debt. Anytime you are under the power of another, it's a bad situation, even if you will eventually become free, by the use of debt, it is still not an ideal position to be in…

With that said I believe in using bad debt as a means to make money I just understand I am a (temporary) slave to the person holding the "IOU". I follow 3 simple rules in the use of bad debt.

1) Never over leverage. ie more than 50% of the value of my total holdings/assets, 10-25%is ideal, in other words $0.50 of debt for every $1.00 of realistically liquidatable assets, or preferably $0.10 – $0.25 for every $1.00 in assets.

2) I only use debt when the purchase is time sensitive, and the cash is not presently available. ie the share price of a holding dips to a particularly relative low and is trading at a major discount.

3)  I bring this (margin) debt to $0.00 at least once every calendar year, preferably before Jan 1st.

Hi Phil
I just recently graduated with $5500 in student loans and got a job as a financial representative at a brokerage firm. I don't make a lot of money as of now but I'm thinking of putting way maybe $200-$300 dollars away every month and investing it over buying a new car. My question to you is, when will I see that investment start to generate some good income?

Phil question for you. You mention how you went from $1,000 to a million in 5 years time? How was that done what stocks did you invest in what was the time period? Also if I was only going to read one of your books which one should I pick?

Thanks Phil. We also follow Dave Ramsey so it is hard to hear "good debt" be we have used debt to improve cash flow. We did not go into debt but did borrow from one of our funds to extend your workshop for more education and getting it paid back with the knowledge so thanks for all you do!

very good. for a non-regular investor, what would be a good broker to use here in the UK? thanks