Bad Debt and Good debt, one is good, and the other is bad. But what are some practical ways to make money by using debt And that’s why in this video I'm going to break down 7 simple ways to make money using debt as leverage. Dave if you're watching this, yes I'm talking about using credit cards to make money, you might want to click off this one.
Now before I continue to tell you ways to make money from debt
To put it into simple words: Good debt makes your money and bad debt takes money from you
Person A: Used credit cards to go on dates and buy cloths, and also has a car loan. All these things take money from him
Person B: Used a credit card to start a business, and generate cash.
Good Debt vs Bad Debt How to 7 Ways to Make Money from Debt
1. Resell (short term)
Example: I use to sell products on eBay and also dropship, I would buy the products with credit cards and then ship them, and pay it back. ( a lot of points and no interest)
Cost: $0 as long as you pay at the end of the month
- Have a cash reserve just incase
How: I got an Amazon CC 5% and bought 15-20k worth of products and got a lot of cash back.
2. Balance Transfers (long Term)
Example: A lot of time ive needed money for investments, and I just dont have all the cash. So I get a cash advance and get that money from their.
Cost: 0-5% if done correctly
How: Once I got the cash, I would transfer the balance to a balance transfer card with a promotion on it.
3. Provider Phone Flipping
Example: I’ve been with my company for a long time, they always have deals. Open a line get a new phone and so. So every now and then I open a line and get into debt.
Cost: 0$
How: When I open these lines, I use family members to save them money. I take the phone and sell it and at the end of 1-2 years its paid off, but I already got all the money.
4. Student Loans ( Long Long Term)
Example: When I was in college I took a cash loan of around 7k and started a busiess with it, with the other 10k I had already. That money has made a lot of money since then.
Cost: 2-6% if down correctly (subsidized and Unsubsidized)
How:
- Flip the money from college
- Use the debt to get a carrer and then the return is still high
5. Credit Card Churning ( short term)
Example: I want to traval for free so I get a credit card with a bonus.
Cost: 0-3% max if don’t correctly
How:
Expenses – then your good, just pay them and get the bonus
No expenses – get creative “ Video linked”
6. Angel Capitalist
Example: taking personal loans or credit card cash advances to invest into business or companies
Cost: 0-24%
How:
Less risk: Investing in big establish companies but also less retrned
Small Business: You can lend small business loans with promesary notes, even at a lost as long the busiens is collateral ( depends)
7. Real estate
Example: I’m currently savings for a down paying for an investment property
Cost: 0$ or (negative) if done correctly
How:
Buy – buy realestate and rent for a profit and make cash through rent or the sale
Build: Borrow cash to build real estate and then sell them
Lend: lend buying and builder money to buy and charge interest
Final Thoughts:
Debt is not bad, it all depends on what your using it for.
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