Why is debt of the “bad” sort not good for you

Mihir Shah
Jul 22, 2017 · 3 min read

debt

dɛt/

noun

a sum of money that is owed or due.

“I paid off my debts”

synonyms: bill, account, tally, financial obligation, outstanding payment, amount due, money owing; More

Also means

the state of owing money.

“the firm is heavily in debt”

synonyms: owing money, in arrears, behind with payments, late with payments, overdue with payments, overdrawn; More


The former is the result of the latter. The sum is the absolute outcome of the relative condition of being “in debt”. So let’s talk more about this condition.

HOW does debt accrue?

  • As a loan that is personal, business or educational loan
  • Over spends on your credit cards
  • As a borrowing from friends and family
  • Interest, ie when you can’t service the above 3, it adds on to your existing debt with a compounding effect

More importantly,

WHY does debt accrue?

  • To satisfy a desire which could range from anything like buying a car, to building a new office or studying abroad, giving your kids the best education, etc.
  • To live a “higher” quality of life such as eating at expensive hotels, taking trips abroad, having lavish parties, etc.
  • To fit into a social circle, part of the tribe/peer pressure kinda thing. If you have spendthrifts around, you have only two options, their way or the high way!
  • With most cases most often the reason is; that we ceaselessly trying to fulfill our wants rather than meet our needs. We just have one life so let’s show those around us, that we have arrived.

To finally arrive to the point, why is debt so bad?

  • Adds to more debt — The financial cost

When you no longer can meet your obligations and fixed expenses, to service existing debt, you take more debt at times at ridiculous interest rates, thereby creating a financial catastrophe of sorts!

  • Stress, Anger & Frustration — The emotional cost

Financial turmoil is the biggest cause of stress in a person’s life which leads to many casualties such as life threatening diseases, depression and in many cases, suicide. You will get short tempered and frustrated easily, especially when most people around you go about their lives normally.

  • Lack of focus and peace of mind

When battling growing debt, you can’t focus, plan, innovate or grow. You are always worried. Your mind is so busy grappling with the “situation”, there’s no space for fresh ideas and creativity. All your decisions will be based out of fear or not going down under.

  • Social Stigma

Nobody ever talked bad about a man with a small house and a small car, his kids going to a decent school, living their lives happily without any upheavals. But when your debt goes out of hand and people get a sniff about it, it’s like a breaking news video going viral. Soon, the entire neighborhood will be gossiping about the latest ship to go down, most of whom neither know you nor care.

  • Wasting the golden years of prime youth

If you are young, it’s good and bad. Good cause you have time on your side to get out of the mess and bounce back. Bad cause while you do that, some of the best years of your life will be utilized to reset you from the negative to zero.


Not all debt is bad. If it’s calculated, serviceable and for a necessity, it’s not the one to run away from. In fact, it’s essential for growth! However, if it’s debt not created within the boundaries of financial wisdom, its cancer!

Life is all about happy, peaceful and fun moments without any negativity, stress or depression. Being debt free will enable that. Having expenses that u can comfortably manage will enable that. Your true friends and your family will respect you most when you lead a dignified lifestyle founded on the pillars of integrity and honesty.

Observe your feelings about your debt from positive to negative. If it is largely negative, take immediate steps to get rid of your burden. Make an action plan, take professional advice, whatever it takes to get on to the path of financial freedom.

Being debt free will make u a lighter, brighter and happier person. You will be able to take risks in times of opportunity. You will be able to excel in your job or business since you will be mentally relaxed. Most importantly, you will get rid of the emotional cost that comes attached to debt and lead a better quality of life.

Mihir Shah

Written by

Lover. Husband. Father. Entrepreneur. Traveller. "Live infinitely in this seriously finite universe"

Welcome to a place where words matter. On Medium, smart voices and original ideas take center stage - with no ads in sight. Watch
Follow all the topics you care about, and we’ll deliver the best stories for you to your homepage and inbox. Explore
Get unlimited access to the best stories on Medium — and support writers while you’re at it. Just $5/month. Upgrade