Not all debt is bad. Consider a few situations when debt can help improve your overall financial situation.

 Buying a home

Debt can help make you wealthy! Homes in cities like Denver and San Francisco are currently growing at very fast rates — sometimes more than 10% per year. The average increase in home values across the U.S. was between 3% and 4% per year for the last couple of years.[i]

Student Debt

Right now, student loan debt is receiving a lot of bad press. Many people are afraid they cannot pay back their student loans. Vocational school is one of the most easy financial decisions a person could make. Spend a little for a few years and then earn a lot more for many years to come! People with a professional degree make more than three times the income of a high school graduate, on average.[ii]

CLICK HERE for more help and information about paying for college.

Bad debt

Clearly there are forms of debt that are mistakes as well. Credit card debt can eat up a person’s net worth quickly and may cause bankruptcy. Car debt is a fixed payment on a depreciating asset. In today’s world, where some pickup trucks cost $100,000, it may be difficult to purchase a car without a loan. But it’s worth the effort if you can!

CLICK HERE for Karl’s complete article on the CFP Board® web site.

Next steps

If you would like to learn more about debt management and your financial plan, talk with your financial advisor at A&I Financial Services.


[i] Cushman and Wakefield, US Economic Outlook and Implications for Property Markets

[ii] US Census Bureau, released September 2020

About the author

Karl Frank, Certified Financial Planner ®, MSF, MBA, MA, is the President of A&I Financial Services LLC, a local business that specializes in wealth management, insurance planning, and retirement planning. Karl cares for business owners and the businesses that care for them. Learn More about Karl.