Understanding the basic concepts of debt
Budgeting is an important aspect of living and a person who knows
how to budget will go a long way in this commercialized society.
Budgeting has a lot to do with keeping the expenses less than the total
income of the household. Those who are very good at budgeting can
come up with savings even if they have meager incomes.
The problem sets in when a person fails to make an efficient financial
plan and his expenses exceed his earnings. When this happens, a
person has no choice but to borrow money to make up for his financial
deficiencies. Borrowing once or twice because of a mismanaged
financial plan is normal but when borrowing becomes a regular thing
that can put a person in serious debt problems.
A person who borrows money from another is said to be in debt. The
debts of a person can be minimal or can reach up to millions
depending on the credit limits of each person. Sometimes, a person
who has assets but isn't liquid can use these assets to get cash. Under
this term, the person can be indebted for an amount less or more than
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