How to get the fastest and safest returns on your money
Investors and non-investor alike appreciate a healthy net worth &/or saving account. Those who invest hope to get strong returns to turbocharge the growth of their nest egg. This is a good approach, but not necessarily the first one to try out. As a matter of fact, some of you might actually be in the position to make safer and faster returns immediately.
Be sure. There are no secrets!
This is the simple approach suggested by Mark Cuban – an exceptionally successful American entrepreneur – to young investors. Are you seeking good returns in the stock market? Are you looking for a suitable real estate investment? Do you want to use the power of compounding interest and sweat your assets? Well, Mark Cuban suggests first looking at any debt with high-interest rates and paying it off as soon as possible! Indeed, in several countries, consumer debt (credit card, personal loans, student loans, etc.) can easily reach between 7% and 16%. Quite often these costs negatively compound unnoticed, while we seek more volatile investment returns in the stock market or real estate market. Bottom line: by prioritizing the paying off “bad” debt with high-interest rates, you obtain immediate secure great and safe returns: this is already a sound investment!
I make a point of differentiating between bad debt and good debt. In general, I would say that it is better to manage personal financial matters without debt. However, I still believe there is the opportunity to cautiously use debt, as long as the interest rates are extremely low and the purchase is done under great terms (ex. purchase of an apartment). For most personal expenditures or personal investments, I warmly suggest keeping credit lines under control. Going back to Mark Cuban suggestion by paying the debt off as soon as possible before wandering into active investments.