Broadly speaking debt can be secured, where you put down collatoral or unsecured, where you don't put down collatoral. Collatoral is an asset that you give to the person you borrowed from if you cannot pay your loan. The most common example of debt would be a mortage, a loan you might get when buying a house. Typically the house is used as collatoral, so that if you cannot pay the loan the bank could take your house.
Debt is money that you have borrowed from someone else and promise to payback plus interest. You will always end up paying more money than you initially borrowed on a loan and loans are considered liabilities. Most kinds of debt can be dangerous if not managed safely. Other types of debt include student loans, business loans, car loans, mortgage, investing on margin (borrow money to invest), lines of credit, home equity line of credit (HELOC) There is the caveat that low interest debt is not as terrible (mortgages can be good for general public—forced savings plan on money that would otherwise be wasted, student loans get you an education that should increase your future income) Paying 20% credit card debt gives you a 20% rate of return. Credit cards typically have high interest rates around 20%, mortgages can have rates as low as 2-3% The current interest/inflation rate environment makes it an odd time for loans.I am generally opposed to taking out loans.
Debt is money that you have borrowed from someone else and promise to payback plus interest. Since loans typically result in you paying more money than you initially borrowed they are considered liabilities. Most kinds of debt can be dangerous if not managed safely.
Credit cards typically have high interest rates around 20%, mortgages can have rates as low as 2-3%. You can consider paying off credit card debt as providing you are 20% rate of return. A 20% rate of return that is a sure thing is an amazing investment.
There is the caveat that low interest debt can be used wisely (mortgages can be thought of as a forced savings plan on money that would otherwise be wasted, student loans get you an education that should increase your future income). With the current interest/inflation rate environment it can make sense to take on a loan if you are able to obtain a better rate of return than the loan interest payments.
There are many types of debt including student loans, business loans, car loans, mortgage, investing on margin (borrowing money to invest), lines of credit, home equity line of credit (HELOC) and more.