For years, certain debts were called “good.” Mortgages, student loans, and business loans were often seen as smart choices. More recently, that view is shifting. Rising costs, unstable interest rates, and new financial pressures are making even these debts feel risky.
Mortgages Aren’t a Guaranteed Wealth Builder Anymore
Owning a home was once a ticket to building wealth. But with sky-high home prices and unpredictable interest rates, many new homeowners are paying more than their properties are worth. Housing isn’t the financial safety net it used to be.
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5 DAYS TO A BETTER BUDGET
Student Loans Are No Longer a Clear Investment
Borrowing for education was seen as a smart move—until skyrocketing tuition and uncertain job markets flipped the equation. In 2025, many graduates are drowning in debt without seeing the promised income boost, making this “good” debt a heavier burden than expected.
Auto Loans Have Ballooned Out of Control
Car loans used to be straightforward, but rising vehicle prices and longer loan terms have turned them into a major liability. Even modest cars now come with payments that strain monthly budgets, making auto debt a lot riskier than it once seemed.
Business Debt Is Risky Without Stability
Entrepreneurship is often encouraged with the idea that business loans are “healthy” debt. But with supply chain issues, inflation, and market volatility, many small business owners are finding themselves stuck with loans that their current revenue can’t safely cover.
Credit Card “Points Hacking” Is Backfiring
Using credit cards strategically for rewards used to be considered savvy. But in 2025, rising interest rates and increasing minimum payments are catching people off guard. One misstep or unexpected bill can wipe out any gains from those “smart” credit strategies.
Personal Loans for “Investments” Are Fizzling
Taking personal loans to invest in side hustles or quick-return ventures is a trend that hasn’t aged well. Many people who borrowed for these opportunities are now facing higher loan payments with little to show for it, turning supposed “healthy” debt into a financial drain.
High-Interest Rates Wiped Out the “Low-Cost Debt” Argument
For years, people justified carrying debt by pointing to low interest rates. But with rates climbing, that argument no longer holds. Payments have surged, and debt that once seemed manageable has become a financial chokehold.
Debt Is Stretching Emergency Funds Thin
“Good” debt assumes you have a cushion. But in reality, inflation has shrunk emergency funds, leaving little room to handle unexpected expenses. The more debt you carry, the fewer resources you have to cover sudden financial hits.
The Emotional Toll of Debt Is Being Taken More Seriously
The stress of carrying debt—even the so-called “healthy” kind—is taking a mental toll. Financial wellness isn’t just about numbers; it’s about peace of mind. Many are realizing that the psychological weight of debt undermines any supposed financial “benefit.”
Financial Flexibility Is Now the Priority
In 2025, being debt-free (or close to it) is starting to feel like the ultimate financial win. People are valuing flexibility and stability over leveraging debt for potential gains. The old playbook is being rewritten, and “healthy debt” no longer feels like a smart default.
How to Drastically Cut Expenses to Get Out of Debt Quickly
Cutting expenses to the bone is scary and overwhelming to most people. But when you’re deeply in debt and feeling lost, you begin to search for any opportunity to shorten your everyday expenses list. Try these tips to cut expenses and pay down debt fast. How to Drastically Cut Expenses to Get Out of Debt Quickly