Household Debts: Where Do We Go From Here?

Much has been said about the high level of household debts in the country. Overspending, increasing cost of living, property and automobile purchases are the main contributors to the prevailing level of household debts. We can make a case that housing loan is a “good” debt as property is a form of investment. Over time, property value appreciates, particularly those at strategic locations. On the other hand, the same cannot be said about car loan as car is a liability as the value depreciates over time. However, for this discussion, let’s assume that we can justify for a car loan, by stating that a car is a basic necessity. In many cases, a car is a necessity for a household due to poor public transportation, even more so for family with kids or elderly parents.

Read more...