Good Debt vs Bad Debt

I was thinking lately about the Good Debt idea that Robert Kiyosaki talks about in Rich Dad, Poor Dad.

It's been a few years since I read it (which is a great book by the way), but he gave a specific example of how he took out a loan for something like a million dollars, then used the loan to buy and renovate an apartment complex, which then made enough money over the next few years to totally pay off the loan itself. The apartment complex actually brought in more monthly income than the monthly loan payments, so essentially he borrowed money to make more money.

I thought this was really cool. In essence, he borrowed cash so that he could purchase an asset, which is something that literally generates cash itself. Then after the loan was paid off, all of the generated cash was pure income.

Any SBI'ers in here can appreciate this story, as in the SBI forum there are always people selling sites that they no longer want. Sometimes you will see a really great deal, too. In the last week I was considering buying a website that was under-monetized and still making $60/month in income for only $1000. I was confident that if monetized correctly, it could make at least $100/month or more. I ended up not purchasing it because I thought I would need the $1000 to help pay for the Ignition program which I talk about in a different thread (I ended up getting it for free).

I just wanted to say that we don't need a loan of $1,000,000 to apply "good debt" principles to ourselves. If you are web-savvy and online business-savvy, you can start using "good debt" to buy assets even with as little as $1000.