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I don't care what debt you are referring to. The first step is education not eliminating debt otherwise elimination has limted meaning
You are so pedantic it's pathetic.
If you go back and read my post, what I said is that ONE of the first steps for most people is getting out of debt. This sort of implied that another step was getting educated about why they must do so.
If you go back and read my post, what I said is that ONE of the first steps for most people is getting out of debt. This sort of implied that another step was getting educated about why they must do so.
So your first blanket statement was about debt but you meant cnsumer debt and now your first step was t eliminate debt but now you meant to also include education? Well how about you actually state what you mean from the start? Avoiding debt isn't the sure road to accumulating wealth end of story
Lowexpectations & atltechdude - I respect both of you guys and you should respect each other as well. Please keep the tone clean and do not get offended easily.
Thank you all for your inputs I really appreciate it and you've have given me a quite unequivocal answer, most of you are against a consumer loan, whilst others believe it might be possible? Thank you all!
Thank you for your reply. My consumer loan rate is 4,99%. This is not a bad rate in my opinion?
Is that interest tax deductible? What is your marginal tax rate?
As an example, if your marginal rate is 25% and your interest is not deductible, then you need to earn 6,6% on your investments just to break even.
That is, 10 000€ in debt becomes 10 511€. You need your 10 000€ to become 10 680€ after 12 months to cover your taxes and the 511€ in interest on the debt.
Normally, the taxation authorities don't care how you earned the 680€. They just want their 170€ that you owe them.
If you can leverage debt the right way you will create alot of wealth. I used to believe in Dave Ramsey's principle of no debt ever. This strategy makes sense if you're in a deep financial hole. Unless you can 'save' thousands of dollars on regular basis, debt will be a great tool to achieve your financial goals. It's like paying cash for a house by saving for 20 years. I don't know about you but I hate renting and I'm not going to 'save' decades to be able to buy a house. I can use debt with some cash in the deal so that my housing cost is fixed and mostly likely get cheaper as rents go up. Afterall house is a liability unless it generates cash flow. Saving would work nicely if rates were reasonable. Doesn't mean you use debt to buy new cars or go on fancy vacation. But if you can leverage debt to buy quality assets then go for it.
First and foremost, sorry for any spelling mistakes other language barriers etc - I live in Denmark and English is therefore my second language.
Alright with that out of the way, I am considering obtaining a consumer loan in order to invest a larger amount of money in stocks. What I would like is for someone to discuss the pros and cons with. I know it might not seem like the best idea at first, however I have great faith in the Swedish stock Fingerprint that should give a great return and therefore I would be able to pay off my "debt" and still make some cash?
What are your thought on this topic?
I look forward to a great discussion - keep the tone clean please
//
P
Everything you do is a calculated risk, including doing nothing. I think the questions you should ask yourself are (no need to give us answers on this forum, this is only for yourself):
- How thoroughly do you understand the risks and potential rewards? Before making an investment that's meaningful to you, you should understand them thoroughly.
- Have you considered other investments? There may be an alternative with a risk / reward profile that's better for you.
- Is it an acceptable outcome if you lose your entire investment? Obviously this would be bad, but would it mean real hardship? You should consider the range of outcomes, their likelihood, and what they'll mean to you.
First and foremost, sorry for any spelling mistakes other language barriers etc - I live in Denmark and English is therefore my second language.
Alright with that out of the way, I am considering obtaining a consumer loan in order to invest a larger amount of money in stocks. What I would like is for someone to discuss the pros and cons with. I know it might not seem like the best idea at first, however I have great faith in the Swedish stock Fingerprint that should give a great return and therefore I would be able to pay off my "debt" and still make some cash?
What are your thought on this topic?
I look forward to a great discussion - keep the tone clean please
//
P
Hi Proinvest,
First, I compliment you on your mastery of English.
Second, what you are considering is NOT INVESTING. It is SPECULATION. There is nothing wrong with speculation, but don't confuse speculation with investing.
The speculation part isn't about the borrowing. The speculation part is about buying a single stock.
You didn't mention other assets -- do you own other financial assets? Or would Fingerprint be your initial asset purchase?
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