Debt
Financial difficulties are the number one cause of marriage breakdowns, suicide, theft and robbery, as well as a host of other problems that we face today. As a society we have come to believe that winning the lottery is the ultimate way to reach financial security when in fact the chances of winning the lottery are less that those of being hit by lightening. Recognizing that solving financial problems is the solution to financial peace of mind is the first step in reaching that goal.
Canada’s National Debt August 2006
includes all Federal, Provincial and Municipal debt and tax.
| Debt: |
$803,932,131,913 |
| Debt per Canadian: |
$25,165 |
| Debt per worker: |
$50,404 |
| Taxes: |
$537,505,236,418 |
| Taxes per Canadian: |
$16,825 |
| Taxes per worker: |
$33,700 |
U.S. National Debt August 2006
| US population |
299,239,976 |
| Debt: |
$8,450,989,646,751 |
| Debt per American: |
$28,241 |
The average American today has nineteen different credit cards with an average outstanding balance of just under $10,000. Credit card delinquencies account for five percent of all customer missed payments. We continue to buy more expensive houses with little or no re-payment of principle, so in fact we are not buying more house -- we are just buying more debt. The average car loan now exceeds five years in duration.
There is good debt and bad debt.
Bad debt is using credit to purchase items with no appreciable value, ie buying a home but not paying off the principle; or buying cars or luxury items that depreciate in value.
Good debt is taking on debt then reinvesting those funds in an asset that will appreciate in value, ie. using a home equity line of credit to create a passive income.
Not all debt is bad!
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