Every single one of us would be thrilled to have more money coming into our homes every month. If you’re relying on one or two paychecks as the primary earnings for your income, you can relate that it’s pretty tough to get ahead. Everyday expenses chip away at our standard incomes and unless you manage to get a big promotion, chances are you’re going to be treading water for a long time to come.

How about, instead of just your regular paycheck, you were able to have several different income streams every month? That sounds pretty good, right? The main problem for many people is that they don’t have enough money to make new money. That old adage is more true than ever and if you don’t happen to be independently wealthy, it can seem as though you’re never going to break that cycle of living paycheck to paycheck and get ahead.

However, there is a very smart way that absolutely everyone can use to start making more money. While most of us are familiar with how debt works, it has gained a pretty bad reputation. We tend to look at debt as though it is an evil thing, and something that should be avoided at all costs. While this is true to some extent, especially if you are using your debt in the wrong way, there is a form of debt that is actually quite beneficial.

Good debt is debt that you leverage to create something. Bad debt is money you spend on credit for things that are completely useless. Let’s look at this way. You can go into debt to invest in a business or a stock, and then have it return your original investment ten fold, or you can go into debt to buy a flat screen television that is never going to do anything more than provide entertainment and collect dust. This is the main difference between bad and good debt.

Debt, when managed properly, is the key for many of us that want to make more money. Even the richest people on earth had to start somewhere. The best stories of the self made entrepreneurs always include the part where they had to get a loan, either from the bank or a friend, to invest in something they believed in. Years later that debt paid off big time in the form of millions of dollars. This exact same technique will work for anyone, provided you make smart investments and don’t overextend yourself initially.

To recap, debt is not necessarily the root of all evils, unless it is improperly managed. If you’re using debt to buy things you really don’t need, then yes, it’s going to be a problem if you overspend. However, if you are leveraging that debt into investments and opportunities that will create new streams of income, you are getting the benefits that so many entrepreneurs have already reaped to get where they are today.

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Originally posted 2008-11-19 06:23:08. Republished by Blog Post Promoter

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  This really sounds like the ultimate oxymoron, but one of the best ways to get out of debt is to go a little bit further in. What’s that? First, to help this make more sense, let’s clarify – if you need to get out of bad debt, going into good debt will help you pay off those credit cards and make more money. It’s important to understand that there is a huge difference between good debt and bad debt. Going into good debt has some risks, but when managed correctly, you can end up making enough money to quit your job, pay off your bills and save for retirement.

  Let’s take a look at one example of how going into good debt can get you out of bad debt. For this example, let’s say that we have a person who has $10,000 in credit card debt. They’re overextended with too many cards and paying way too much interest. It’s getting harder and harder to make those monthly minimum payments and it seems as though it will take decades to get out of this mess.

  Instead of declaring bankruptcy and just giving up, let’s say that this person goes and gets a loan for $2000. Since their credit is still pretty much intact, this isn’t an issue. They take than $2000 and invest it into ten shares of a stock that sold for $200 a piece. Within the first month, the price of that stock triples. They now have $6000 and it’s only been one month. They take $2000 out of that amount to pay off the loan, and are left with $4000.

  Over the next month, the stock once again goes up. That $4000 is now $8000. The person cashes out the stock, pays down their credit cards and is left with a manageable $2000 in debt. Why not pay it all off? The secret to great credit is leaving some debt that you continue to make payments on – this builds up your credit score. In two months, the person was able to go from $10000 in debt to paying off all but a small portion of it.

  Compare that to getting a consolidation loan. In two months, the person would not have made a dent in what they owed. If the stock market isn’t your thing however, there are many other ways that you can use good debt as leverage to create multiple streams of income. Whether you deposit it in a high interest bank, buy a CD or purchase a rental property, a leveraged loan can help you get out of debt much faster than a consolidation loan.

  The key is picking the right opportunities and managing your money. Once you’ve paid down your bad debt, keep using good debt to create more income streams. This is the secret that thousands of millionaires use every year to keep bringing in tons of cash and it will work the same for you.

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  Originally posted 2008-11-24 07:44:19. Republished by Blog Post Promoter

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