Debt Consolidation Pros & Cons

Certainly the pros lie on this, if you have a lot of debt, you’re not able to build wealth. But there’s good debt and there’s bad debt so you have to look at the subtleties on the over-all situation. The pros of retiring bad debt are evident; a credit card debt consumer debt, things of that nature will drag down your wealth building abilities. And paying of those instrument are very, very key to your, to the health of your wealth. But the cons of paying off good debt that is paying off your mortgage too soon means that you’re retiring tax deduction that you heretofore have.

Mortgage interest is tax deductible to the holder to the mortgagee and it will actually effectively lower your taxation rate. So be mindful of paying off your mortgage too early because if you do so, you’re opening up your asset that would be your home to be the factor of having a lawsuit put upon it, various things of that nature. You want to make sure that there’s enough good debt on your assets so you that you are protected from an assets point of view.