Kiteretsuu

Power of debt/loans

Are there any good YT videos, podcasts or articles which talks about how debt money or loans can make you rich if used wisely?

We are always taught that debt/loans are bad and you should avoid taking it or should just repay it as soon as possible.

Many rich people made money in the past using loan money at a lower interest rates and used that to grow their business or invested that money to generate higher returns than loan interest.

P.S - please don't recommend books.

7mo ago

lime

Student7mo

Loans and debt make sense for businesses and startups. Magnifies your ROE(in upsides and downsides both). Essentially you are taking on a fixed cost which you could use to magnify your earnings multifold wherein you only have to pay a fixed amount, depending on how you use the said funds it magnifies your profits or losses for the Equity Holders. Most YT creators(be it Robert Kiyosaki or Warikoo)talk from a business perspective and it definitely makes sense for them.

I don't think they make too much sense from an individual POV, would love an insight on that.

Kiteretsuu

Stealth7mo

Debt/loans are helpful for individuals too if you are already having enough money either laying in FD or planning to invest in market which could generate more returns annually than your interest rates, sometimes its better to not repay your loan early specially home loan(8% rate) as you can save lots of tax for longer period on principal and interest amount you are paying which otherwise you could not avail if you pay off early + if you have > 10L in bank account then you are already getting 7% interest on that amount from bank so that loan you are getting at 1% technically

lime

Student7mo

7% returns are outliers in most cases. You're getting them right now but in a year or two they'll shift back to 5-6.5%. You didn't take into account the financial security of an individual, losing a job even for a few months with an OS Loan is brutal.

Tax Savings aspect I can get behind.

Almost in all cases debt suits people who don't actually need it but can afford it. People you've mentioned fall into that category.

Kenpachi

Veritas technology7mo

You search Ken McElroy on YouTube, he shares his real estate strategy about how to build a business using only debt. It's not possible to replicate in India but good to know

TheHoneyBadger

Deloitte7mo

Okay people make fun of him, but Ankur Warikoo gives some nice content online. I also read his book make epic money but that's inspired by his talks only.

Kiteretsuu

Stealth7mo

Yeah he does give some good advice but I'm looking for some videos or articles which can blow my mind after watching or reading it, kunal shah kinda thing

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