Bad Debt vs. Better Debt | Trustee in Bankruptcy | Albert Gelman Inc. – Offices in Toronto, Scarborough, North York, Mississauga, Richmond Hill

Bad Debt vs. Better Debt | Trustee in Bankruptcy | Albert Gelman Inc. – Offices in Toronto, Scarborough, North York, Mississauga, Richmond Hill

Bad Debt vs Better Debt

You may have heard that there is such a thing as “good debt,” and wonder how it is possible to owe a creditor money in a good way. Although it’s true that there is debt that can be considered “good” in a sense, however, “good” is not necessarily the best word choice. Think of it as better debt.

Student Loans

The debt you accumulate while attending post-secondary school is much better than the debt you can accumulate from buying that outrageously priced handbag, or getting your car windows tinted. Furthering your career and life successes through education is never a bad thing. However, post-secondary tuition and the costs that come along with it (textbooks, supplies, etc.) can really put a strain on your wallet.

There are a lot of borrowing options when it comes to obtaining a loan as a student. In Ontario, the provincial government offers the Ontario Student Assistance Program (OSAP) to post-secondary students. For those who may not qualify for OSAP, banks and other financial institutions offer loans and lines of credit that are specifically designed for students. All of these options are usually offered at a very low interest rate compared to your credit cards, which can often be double or triple the amount of interest.


There’s no arguing that vehicles are expensive. In addition to the initial cost of the vehicle, you have to consider insurance, gas, and maintenance such as oil changes, tires, etc. However, for many people it is a necessity.

There are many options when it comes to purchasing your vehicle. When you decide to purchase a car, often times you can find dealerships that offer 0% financing, and some will allow you to take up to 84 months to pay off your vehicle. So, although your car loan is still considered debt, you won’t be paying interest on the purchase price, and it can really help to build your credit in the long run.


A house is one of those things that most people cannot purchase outright. Going into debt is inevitable when it comes to obtaining a mortgage for a house. However, a place to live is a necessity, and a house can be appreciated for years.

Another thing to keep in mind is that oftentimes the value of a home will go up as time goes on, or with renovations, so some people can actually earn money on their homes when it’s time for resale.

Be sure you don’t forget to shop around for the best mortgage rate along with your perfect home, and have a healthy down payment at the time of purchase.

Although we can all agree that no debt is “good debt,” but there is such a thing as “better debt.” Things such as post-secondary education, mortgages and car loans can be considered “better debt” because they can help your long-term career and life goals, can be appreciated for a long period of time, and in some cases are a necessity.

Call us today!

To speak with one of our licensed professionals about your financial goals, or to make a plan to pay off your outstanding debt, “bad” or “better,” call Albert Gelman Inc. today 1-855-654-1650 or visit one of our locations to make an appointment.