Debt is a financial obligation to pay back borrowed money with interest. Debt can be used to finance investments or purchases. However, taking on too much debt or using it for the wrong reasons can lead to financial difficulties and instability.
A loan is a form of debt in which a lender provides money or assets to a borrower, and the borrower agrees to repay the loan amount with interest. Loans can be used to finance investments or purchases. Taking on a loan can be a good way to leverage borrowed money to make a profit, but it is important to only take on debt if it is likely to result in a net gain for the borrower financially. This means that the income or value generated from the debt should exceed the interest and other costs associated with borrowing.
https://moneyview.in/loan-insights/difference-between-loan-and-debt
BUY IN CASH: BUY $100,000 HOME PAY IN CASH OUTRIGHT $10,000 YEARLY PROFIT $10,000 RETURN ON $100,000 10% RETURN ON YOUR MONEY
TAKE A LOAN: BUY $100,000 HOME $33,000 DOWN PAYMENT $67,000 AS A LOAN 50/0 LOAN INTEREST = $3,350 $10,000 - $3,350 = $6,650 PROFIT $33,000 TO MAKE $6,650 PROFIT 20% RETURN ON YOUR MONEY
It is generally recommended that individuals only take on debt if it is likely to result in a net gain for them financially. This means that the income or value generated from the debt should exceed the interest and other costs associated with borrowing.
Borrowing money to make money.
Example: Taking a $100,000 loan on a 4% interest to invest and make $12,000. Here, you essentially spent $4000 to make $8000.