Debt Managing Tips

Debt the worst nightmare to almost every person, so it's important to learn about debt and managing debt.

First our pleasures die - and then our hopes, and then our fears - and when these are dead, the debt is due dust claims dust - and we die too ~ Percy Bysshe Shelley

Meaning of Debt

Debt is the amount you borrow from a person, bank or financial institution (lending partner), to manage your financial gaps, your immediate needs or some wants. Lending partner charge some interest rate to you against the amount you borrow.

The interest rate depends on the partner you lend from or the type of loan you borrow. Rate can be as low as 8% for home loans to as high as 24% for credit card debt.

Managing Debt Efficiently

Before taking any type of debt you should know the about the pros and cons, which debt suits with your finance, your need, your paying terms.

You should check these points before taking any debt:

• Do you really need this debt

• How much amount you need

• Can you pay the EMI's on time

• What are the Interest Rate are you getting

• Do you have any backup to pay EMI's

• Do you have enough cash besides EMI to pay for daily needs

So, by knowing the type of debt, ROI of debt and others important points, you can take better decision regarding owning any debt. To get more knowledge regarding debt and other related topics you can follow FinnanceMaster, and you can join our community to get weekly articles regarding personal finance and managing debt.