How to free yourself of the Debt Trap?
Debt Trap is a situation in which a debt is difficult or impossible to repay, typically because high interest payments prevent repayment of the principal.
It is absolutely critical to define the debt problem correctly, if one has to slay this monster once & for all. Looking at the debt trap through the finance prism alone, would be only as effective as treating the symptom, not the disease itself. If the root cause of debt remains unaddressed, the debt problem would re-emerge again & again, no matter how often it gets paid off.
- Core Issue – Every financial problem is just an accumulation of many small mistakes made on the daily basis. It is a natural consequence of one’s financial habits & attitudes. Likewise, permanent solution to a financial problem is possible, only when default response of an investor prevents such mistakes from recurring. Financial mindset of a person is at the core of debt problem as well as its’ solution.
Debt is antithesis of wealth creation. It is however, not all bad, not something to be avoided at all costs, It can be used to leverage growth, to lubricate the wheels of finance & to fill gaps in capital requirement. Debt is great as long as it is used productively & the cost attached to…
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Expense side of the Equation
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